Diversity & Inclusion
The Corporate Restructuring Group at Skadden provides innovative solutions to clients involved in distressed company situations, which allow clients to minimize costs, enhance value and properly position themselves for the future.
We represent troubled companies, their boards, management, owners, creditors, lenders, investors and acquirors handling restructurings in and out of court, financial recapitalizations, business reorganizations, acquisitions and liquidations. Our lawyers also advise on insolvency issues in corporate and financing transactions and on all aspects of distressed debt trading and securities issues. A substantial aspect of our practice focuses on avoiding or mitigating the adverse effects of liquidity or other crises through contingency planning and helping companies overcome the inertia of a downward spiral while they still have alternatives to bankruptcy. In addition, our presence in Europe, Asia and South America allows us to address clients’ needs in the context of insolvency and bankruptcy regimes around the world.
We help clients minimize the time spent in Chapter 11, and our experience in high-stakes, troubled company disputes includes expedited litigation. Skadden pioneered the use of bankruptcy techniques to accomplish corporate objectives expeditiously and economically when a preponderance — but not all — of a company’s creditors support a financial restructuring. These “prepackaged” or “prearranged” bankruptcies — where the terms of a debt refinancing are worked out prior to filing Chapter 11 — result in minimal time spent in bankruptcy, avoiding millions of dollars of fees and damage to enterprise value.
Skadden’s Corporate Restructuring Group consistently has been recognized by peers and restructuring professionals as one of the top practices in the world. We were named among Law360’s Bankruptcy Groups of the Year for 2015. Our practice was ranked in the top tier by U.S. News — Best Lawyers Best Law Firms 2015, Legal 500 2015, Chambers USA 2015 and IFLR1000 2014. Skadden also was recognized as Restructuring Team of the Year at the 2014 IFLR Americas Awards, and we were honored with four awards at the 2014 M&A Advisor Turnaround Awards. In 2013, we were recognized in the Financial Times’ “US Innovative Lawyers” report, as well as in Turnarounds & Workouts, for our representation of AMR’s creditors committee in its Chapter 11 bankruptcy through its merger with US airways.
Nonjudicial Workouts and Restructurings
A significant part of the Corporate Restructuring Group’s practice involves representing companies in nonjudicial debt restructurings, often involving billions of dollars of publicly and privately held debt securities. We have handled restructurings undertaken not only by financially distressed companies, but also by healthy companies seeking to recapitalize or restructure operations, or retire debt at a discount. These transactions have involved refundings or renegotiations of privately held debt, issuer tender or exchange offers for publicly held debt securities, solicitations of bondholder consents to covenant relief, cash infusions from existing or new investors, and asset sales or spin-offs. Examples of these representations include Barneys New York, BCBG Max Azria, Centro Properties, DSW, Harrah’s, Intrawest, iPayment, Marsico, the NHL (in the recapitalization of the New Jersey Devils), Residential Capital, Tele Columbus, Torm and Travelport.
M&A in Bankruptcy
Using Section 363 of the Bankruptcy Code to sell or buy a troubled company’s assets quickly and free up liability overhangs has been an area in which Skadden’s M&A capability has helped shape the industry standard — particularly where enterprise value is eroding rapidly. The “melting ice cube” sale in Refco, orchestrated by Skadden, served as the model for sales of companies in crises such as Lehman Brothers. Other notable transactions include advising a private equity consortium on the purchase of AmericanWest Bank in the first-ever bank holding company Section 363 sale; Borealis Infrastructure Management and Abertis Infraestrucuras as part of a consortium in its multibillion bid to acquire the Indiana Toll Road; Dendreon in the sale of its assets to Valeant Pharmaceuticals; DISH Network in its acquisition of DBSD (utilizing a tender offer for creditor claims); Forge Group in the sale of outstanding shares of capital stock to DRA International; Gaming and Leisure Properties in its joint bid to purchase assets of Florida Gaming Centers; Irish Bank Resolution Corporation in the disposition of €5 billion of assets in the U.S.; the National Hockey League in connection with the Dallas Stars and Phoenix Coyotes sales; Revolution Studios in its acquisition of all of the assets of Inverness Distribution Limited; and Savient Pharmaceuticals and Fortunoff in their sales of assets.
Traditional Chapter 11
Skadden has advised debtors in numerous cases involving some of the largest and most complicated Chapter 11 reorganizations in recent history (Delphi, MF Global, Refco and Winn-Dixie), as well as mid-cap debtors (Excel Maritime, Exide Technologies, Fortunoff, Life Care Holdings, Nautilus Holdings, Ryckman Creek Resources, Spectrum Brands, Syms, Synagro Technologies, University General Health Systems). Depending on the circumstances, we may represent owners (Charter and Lyondell); senior secured lenders (Barclays in the case of Residential Capital, B. Riley in the case of The Wet Seal, Health Evolution Partners Growth in the case of MacKeyser Holdings); committees of creditors (in the case of AMR); committees of equity holders (Chemtura); majority shareholders or parent company (Sciens Capital Management in the case of Colt Defense LLC, Colony Realty Partners in the case of CRP-2 Holdings AA); debtors and creditors (Salus Capital Partners LLC in the case of RadioShack, Walnut Creek Mining in the case of Optim Energy); and boards of directors (Samson Resources).
Skadden has pioneered the use of prepackaged and prearranged bankruptcies to efficiently restructure an entity’s balance sheet. In this area, our representations have included Anchor BanCorp Wisconsin (the first ever prepack by a U.S. bank), Blue Bird Corporation, Central European Distribution Corp., Charter Communications, CIT Group, a consortium of lenders to Entegra’s prepack, Fortress as lender in QCE Finance’s prepack, Globix Corporation, Jackson Hewitt, Mark IV Industries, MGM Studios (the largest ever prepack in less than 30 days), Millennium Health, Select Staffing and Vertis Holdings.
Our team is experienced in handling the challenges arising in restructuring transactions for companies with operations around the world, and which extend across multiple jurisdictions.
We were innovators of the use of English law schemes of arrangement for foreign companies as an alternative to local restructuring and insolvency options. We have represented Roust Trading Limited (the first restructuring of a foreign bank (Russian Standard Bank) through a scheme of arrangement), TORM A/S (where we combined a debt restructuring and merger of a Danish-listed company under the umbrella of a scheme of arrangement) and Tele Columbus (the first time a German operating company used an English scheme of arrangement to restructure). The use of schemes of arrangement in these transactions allowed the implementation of a restructuring transaction without the commencement of insolvency proceedings, thereby maximizing the debtor’s flexibility and control.
Our international representations also include Lazard as financial advisor to Alpha Bank S.A. (Greece), Auto-Teile-Unger Holding GmbH (Germany), Black Diamond Capital Management (in its acquisition of White Birch Paper Company (Canada) (through a Bankruptcy Code Section 363 sale), Excel Maritime Carriers Ltd. (Greece), Hidili Industry (China), IBS Group Holding Limited (Russia), Irish Bank Resolution Corporation Limited (Ireland), Nautilus Holdings Limited (Bermuda), Seat Pagine Gialle S.p.A. (Italy) and Warwick Capital Partners (United Kingdom).