English court sanctions Virgin Active’s restructuring plans, following major challenge from landlords (Re Virgin Active Holdings Ltd)

Table of contents

• Key terms of the restructuring plans
• Questions for determination
• ‘No worse off’ test
• Exercise of discretion
• Cost
• Comment

Article summary

Restructuring & Insolvency analysis: In a landmark judgment, the English court sanctioned Virgin Active’s restructuring plans, notwithstanding a major challenge by certain landlords. This was the first fully-opposed restructuring plan, following an extensive five-day sanction hearing, and the first to compromise multiple classes of landlords. The judgment closely followed the court comprehensively rejecting certain landlords’ challenge to New Look’s company voluntary arrangement; the landlords have been granted permission to appeal. Written by Kate Stephenson and Elaine Nolan of Kirkland & Ellis LLP.