The restructuring plan (RP) is the most powerful restructuring tool available in the UK. It was introduced in 2020 against the backdrop of the economic difficulties caused by the COVID-19 pandemic. Since its introduction, over 50 RPs have been successfully sanctioned for companies ranging in size and in many different industries.
The RP was created under the Companies Act 2006 (rather than insolvency legislation) and enables a company to reach a compromise or arrangement with its creditors. Where this cannot be done consensually, the Court can “cram down” dissenting creditors, provided the relevant statutory conditions are satisfied.
There is a relatively low jurisdictional threshold to access the RP, requiring merely a “sufficient…