Court Approved Restructuring Plan

If your business is facing Insolvency, a bespoke method to reach a compromise with your creditors might be in the form of a court approved restructuring plan. This is different to a CVA and could be a better option depending upon your circumstances. Find out more about Court Approved Restructuring Plans below.

What is a Court Approved Restructuring Plan?

A restructuring plan is a Court-approved agreement between a company and its creditors to restructure its debt often allowing it to pay back some, or all of it, over a period of time.

What is Required for a Court Approved Restructuring Plan?

In order for a restructuring plan to be passed it requires 75% of each class of creditor and shareholders to agree to it.

However, if one or more classes of creditor votes against it all is not lost. If the Court deem the proposal to be of general benefit to the majority of creditors without the dissenting classes of creditors being worse off than under a relevant alternative, it can approve the agreement regardless of the dissenting creditors.

This is unlike a Company Voluntary Arrangement (‘CVA’) where all classes of creditors must vote in favour by 75% or more for it to be approved.

Court Approved Restructuring Plan Process

Putting together a court approved restructuring plan requires a large amount of financial and legal due diligence. The procedure requires two court hearings, the first to approve the classes of creditors voting and the second to approve the arrangement.

At BRI Business Recovery and Insolvency, we work with businesses all over the UK to help them understand their options including Court Approved Restructuring Plans. If you have any questions or would like know more them please do speak with one of the BRI Business Recovery and Insolvency management team.

Work with BRI Business Recovery and Insolvency

For more information and details regarding your circumstances, please contact one of the BRI management team members here.

Contact us if you would like further information and assistance regarding any aspect of a court approved restructuring plan for your company. There is no charge for doing so, and it is done without obligation.