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White & Case Seminar Familiarized Attendees with the Financial Restructuring of New World Resources

The Prague office of the international law firm White & Case hosted a seminar on Wednesday on the topic of "Restructuring of New World Resources – UK Scheme of Arrangement in Czech Context".

The event, which was geared towards the interests and needs of the present restructuring and workout specialists, representing banks and major restructuring advisors, took place at the offices of White & Case. It focused on the recently completed financial restructuring of the owner of OKD, one of the largest employers in the Czech Republic.  The views on the topic and experiences were presented by Christian Pilkington and Boris Docekal from the London office of White & Case as well as Boudewijn Wentink, Chief Legal Officer of New World Resources who provided his unique insight into the process from the inside of the embattled miner. The Prague office has made a tradition of organizing such seminars, which regularly involve contributions by foreign experts from the firm’s global network. 

Christian Pilkington, Head of Financial Restructuring and Insolvency of White & Case for Europe, Middle East and Africa, explained, among other things, that the restructuring was only achieved thanks to the latest know-how in international corporate rescue. "This was a difficult and complex process which involved various stakeholders with diverging interests and a debtor with assets in multiple jurisdictions. Without the flexibility and proven technology of the UK scheme of arrangement process, New World Resources may not have been able to survive as a going concern," commented Mr. Pilkington. 

The key advantage of a scheme of arrangement, according to Mr. Pilkington, is the possibility to bind dissenting minority creditors to a restructuring plan supported by the required statutory majority. This does not feature in local processes which require unanimous agreement of creditors in workout situations. Scheme also allows for implementation of almost any commercial terms that the creditors and the company agree as long as all the creditors in the relevant creditor group are treated fairly. Therefore, at least in situations where the amount of debt of the relevant debtor justifies the potentially significant cost, the scheme should and normally will take precedence over a local process. 

He also brought up the increasing prominence of the scheme process in the CEE region and explained the key difference between the scheme and local processes. "In the CEE, there is no restructuring process that would force the various stakeholders to a negotiation table and enable the majority to overrule the minority in a situation where it is clearly in the interest of the debtor and its stakeholders," the London-based restructuring expert pointed out on Wednesday, highlighting why we are likely to see even more schemes of arrangement in the CEE in the future.

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White & Case in the Czech Republic

White & Case is one of the largest international law firms operating in the Czech Republic, where its Prague office has been providing legal and tax advisory services since 1991. With more than 50 lawyers and tax advisors, the Firm focuses on mergers & acquisitions, private equity, capital markets, complex bank and financial transactions, financial restructuring and insolvency, property investments, privatization projects, litigation and direct investments. The office provides advisory services pursuant to Czech, English and Slovak law as well as the law of the State of New York. 

About White & Case

White & Case LLP is a leading global law firm with lawyers in 38 offices in 26 countries. Among the first US-based law firms to establish a truly global presence, we provide counsel and representation in virtually every area of law that affects cross-border business. Our clients value both the breadth of our global network and the depth of our US, English and local law capabilities in each of our regions and rely on us for their complex cross-border transactions, as well as their representation in arbitration and litigation proceedings. 

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