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Grant Thornton acts on the Successful Restructuring of MIE Holdings Corporation
Grant Thornton acts on the Successful Restructuring of MIE Holdings Corporation
Grant Thornton Specialist Services (Cayman) Limited and Grant Thornton Recovery & Reorganisation Limited (Hong Kong) are pleased to have acted in respect of the successful debt restructuring of MIE Holdings Corporation ("MIE") implemented by way of a Cayman Islands scheme of arrangement (“Cayman Scheme”).
MIE is a Cayman Islands incorporated company listed on the Hong Kong Stock Exchange (having New York governed notes traded on the Singapore Stock Exchange). MIE is the holding company of a group of companies which is one of the leading independent upstream oil and gas companies in the People's Republic of China focused on the exploration and development, production, and sale of crude oil.
On 28 May 2021, Margot MacInnis of Grant Thornton Specialist Services (Cayman) Limited together with Mat Ng and Georgia Chow of Grant Thornton Recovery & Reorganisation Limited (Hong Kong) were appointed as joint provisional liquidators of the Company on a ‘light touch’ basis for the purposes of developing and implementing a restructuring of MIE's financial indebtedness (the "JPLs"), whereby management of the Company remained with the existing directors subject to the oversight of the JPLs.
The JPLs worked closely with the MIE Board and its primary creditors to broker a feasible and fair Restructuring plan for the benefit of MIE and its creditors generally. This included monthly reviews of financial information, overseeing the exercise of management powers and approving necessary changes, ongoing discussions and negotiations with primary creditors, and reporting to the Grand Court of the Cayman Islands.
Outcome
The Cayman Scheme was approved by an overwhelming majority of the relevant creditors at a scheme meeting held on 17 March 2022 which was sanctioned by an Order of the Grand Court of the Cayman Islands on 25 March 2022.
The Cayman Scheme effected the release and cancellation of MIE's existing notes in exchange for the issuance of new notes which will ease MIE's debt burden and allow MIE to focus on its business operations. The use of a Cayman Islands scheme of arrangement, coupled with an application for Chapter 15 recognition of the Cayman Scheme to compromise the debt as a matter of its governing law (as part of the wider Restructuring) demonstrates the continuing popularity of the use of Cayman Islands schemes of arrangement in restructurings.
MIE’s co-operation and proactive engagement was considered a key component in the successful implementation of the Restructuring which in turn afforded it an essential lifeline, paving the way for MIE to continue to operate as a going concern.
Legal advice and representation from leading counsel at Walkers and Ashurst proved essential in assisting MIE in developing a considered Restructuring plan, both firms working collaboratively with Grant Thornton, with the overarching objective of meeting the needs of all stakeholders. The team also worked with Stroock, Stroock & Lavan LLP and Paul Hastings LLP in respect of recognition of the Cayman Scheme under the Chapter 15 in the United States.
Highlight
One unique feature of the Restructuring was that an Order was sought and obtained with respect to the withdrawal of the relevant winding up petition and consequential discharge of the Grant Thornton as JPLs taking place conditionally upon a certain closing notice being issued informing creditors that the closing was to occur. This typically does not occur until after a restructuring has been completed, thus in our case helped accelerate the process, saving time and expense.
We are pleased that through a collaborative approach and solutions-driven ethos, the Cayman Scheme was unanimously agreed, presenting a better outcome to creditors than if MIE were faced with the alternative of an official liquidation.
