EP 15 | Creditors in the Driver's Seat

This week on Credit Lens Europe and Beyond, Phoebe Appenteng and Katie McMahon unpack the inaugural EMEA Restructuring Outcomes Report from Octus. The headline across 30 large-cap deals: amend-and-extend is losing its grip. Debt-for-equity swaps now make up half of all transactions, creditors walked away with the keys in over 40% of deals, and original sponsors were wiped out or diluted to irrelevance in 10 of 15 debt-for-equity cases.

Ardagh is the centrepiece (02:08), with senior unsecured noteholders taking 92.5% of the equity and Paul Coulson and other legacy shareholders sharing a $300 million exit via Yeoman Capital. New money is now nearly mandatory (25 of 30 deals). The lone holdout: Altice France, where Patrick Drahi held onto 55% on the back of loose docs.

Then (06:05), creditor-on-creditor violence goes mainstream in Europe. Selecta's Hobson's Choice, Lowell's debt-to-securitization uptier, and Kloeckner Pentaplast's Chapter 11 dash for a DIP roll-up all show Europe borrowing from the American playbook. On venue (10:59), the Part 26A trilogy of Thames Water, Petrofac, and Adler has dented UK confidence, while France and the US keep pulling large mandates.

Then something different (16:09). Chris Haffenden sits down with Fiona Huntriss of Pallas Partners on s.901C(4) of the Companies Act 2006. Not cramming creditors down, but cramming them out. Fiona acted on the only case where it has ever been deployed, the second restructuring plan for Smile Telecoms in 2022, and walks through why even then the courts trod carefully. With Waldorf now raising its spectre (19:48), her read is that it remains a draconian tool but its profile is rising fast in live negotiations.

Afternoon Tea (24:23): a Florida family suing NASA after 1.6 pounds of space debris crashed through their roof. Then (26:04) Katie's in the hot seat for Identify the ReFi: a French retailer still wrestling with a chunky 2027 TLB, and a European satellite operator that raised €1.5 billion to retire 2029 and 2027 paper. 

Hosted by Phoebe Appenteng & Katie McMahon

Guest Segment:

Chris Haffenden (Senior Editor, Octus) 

Fiona Huntriss (Pallas Partners)

Produced by Charlie Hall |  Edited by Fawaz Muhammed

A Production of The Octus Podcast Network