Petrofac - Case Update

Petrofac has announced its intention to appeal the Court of Appeal’s decision overturning the approval of its restructuring plan to the Supreme Court, while also sharing it has secured support from key creditors, who have agreed to give the company until the end of November to find another solution to deliver its restructuring.

Last month, we wrote about how the Court of Appeal had overturned the High Court’s approval of Petrofac’s restructuring plan, finding in favour of dissenting creditors Saipem and Samsung on the basis that plan benefits were not fairly allocated between creditors.

Since the Court of Appeal released its decision, the industry has grappled with how the decision will impact the approval of restructuring plans going forward. Some have characterised the decision as “more wide-ranging than the carefully nuanced appeal decisions in Adler and Thames Water”, and predicted it will prompt greater introspection for prospective plan companies, while others have mused that the decision means out of the money creditors may well have a seat at the table going forward.

Now, Petrofac has affirmed its commitment to the restructuring plan, revealing that it has applied to the Supreme Court for leave to appeal the decision. In that regard, Petrofac’s bondholders, investors and other creditors party to the lock-up agreement have committed to an extension to 30 November 2025. Meanwhile, Petrofac’s board says it has identified and is progressing a number of routes to deliver the restructuring, including through a plan that addresses the “narrow grounds” forming the basis for the Court of Appeal’s decision.

Read the update HERE.

Professionals involved:

• David Allison KC, Henry Phillips, Ryan Perkins and Stefanie Wilkins of South Square (instructed by Linklaters) for Petrofac

• Daniel Bayfield KC and Riz Mokal of South Square (instructed by Weil, Gotshal & Manges) for the Ad Hoc Group

• Andrew Thornton KC of Erskine Chambers and Jon Colclough of South Square (instructed by Mayer Brown) for Saipem and Samsung