Rosenblatt has successfully helped the founders and senior management of Corbin & King, who operate London restaurants including The Wolseley, The Delaunay, and Brasserie Zédel, fight off a High Court challenge brought by the majority shareholder of the group to try and prevent them repaying senior debt. This court clash came days before the expiry of a legal moratorium protecting Corbin & King’s individual restaurants from insolvency.
In January Corbin & King’s majority stakeholder and secured lender, Thai hotel operator Minor International, had called on the group to repay almost £34m of loans within 24 hours. This was after a long-running dispute over how the group should be run came to a head. Minor thereafter appointed FRP Advisory as administrators over the Group’s top holding company. However, with Rosenblatt’s assistance, Mr King and his fellow directors appointed Monitors (Rob Harding and Benji Dymant) from Teneo Financial Advisory over the Group’s trading subsidiaries, meaning Minor could not appoint administrators during a 20-day moratorium period.
With the clock running down on the moratoria, the group’s co-founder, Jeremy King secured a £38m rescue package from US investment funds Knighthead Capital Management and Certares, which included repayment of £34m owed to Minor.
However, in a bid to avoid losing control of their secured debt, and in a highly unusual move, Minor applied on Friday for urgent injunctive relief preventing King and his fellow directors from accepting the funding and repaying the debt on the basis that it was a breach of the terms of a shareholder agreements.
At a hearing held yesterday in the High Court, Mr. Justice Foxton dismissed the application for an injunction, upholding Mr King and the directors’ view that repaying a hostile creditor threatening to appoint administrators was in the best interests of the restaurants. Having rejected Minor’s application, Minor has since been repaid in full, and the monitorship has been concluded with a successful end. The Monitor process is relatively new, following the introduction of the Corporate Insolvency and Governance Act (CIGA) legislation in 2020. It provides viable businesses with protection to facilitate a solvent rescue, when such a rescue is likely.
The Rosenblatt team was led by Partner and Deputy Head of Dispute Resolution, Simon Walton, Founder Ian Rosenblatt and included Associates Charlotte Woodward and Luther Kisanga, and Solicitor George Kestel. Rosenblatt instructed Nigel Dougherty of Erskine Chambers to appear for Corbin & King at the hearing.
Commenting on the outcome, Simon Walton said: “I am absolutely delighted for Jeremy [King] and his management team with this result. The Corbin & King restaurant empire is an institution which I am proud to help protect and flourish. The application for urgent injunctive relief from Minor was a desperate attempt to keep control of the business after they themselves had demanded repayment of the debt and appointed an administrator to the TopCo. I am pleased, but not surprised, that Mr Justice Foxton recognised the application had no merit, and that it is not for the Court, nor the shareholders in a company, to fetter to discretion of directors when acting in accordance with their fiduciary duties. I hope this paves the way for the end of what has been a bitter dispute between the shareholders so that Mr King and his colleagues can continue to do what they do best, create and operate fantastic restaurants where everyone around the world wants to come and eat.”
Commenting on the outcome and our work, Jeremy King said: “We are delighted [with the outcome]. Conflict and litigation require great clarity of thinking, incisive action and a calm head. Simon [Walton] and his team more than amply qualify on all these qualities. However, they alone are not enough to successfully conduct a client through some of the potentially most stressful weeks, months, even years of their life. Nothing is too much for Simon as he works tirelessly and with a single-minded, indefatigable determination to protect, always enhance and solve the situation and yet doing so with care, consideration, and empathy. I come from the world of hospitality and was singularly impressed by Rosenblatt’s ability to make me feel looked after at every level as they achieved amazing results. I couldn’t recommend them all more highly.”
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