In the matter of Waldorf Production UK Plc and In the matter of the Companies Act 2006

Permission to Appeal granted

Case summary
Permission to Appeal
Previous proceedings
Change log

Case summary

Case ID

UKSC/2025/0169

Parties

Appellant(s)

Waldorf Production UK Plc

Respondent(s)

HMRC

Capricorn Energy UK Limited & Capricorn Energy Plc

Issue

What is the correct approach to the treatment of creditors who would be “out of the money” (would not receive a payout) in the “relevant alternative” to a restructuring plan sanctioned under Part 26A of the Companies Act 2006?

Facts

This appeal concerns a restructuring plan (“Plan”) pursuant to Part 26A of the Companies Act 2006. The Plan was proposed by Waldorf Production UK Plc (“Waldorf”), a public limited company that is part of a group engaged in the exploration and production of oil and gas, on account of financial difficulties it has encountered. The Plan creditors include the economic owners of secured bonds issued by Waldorf. They also include, as unsecured creditors, HMRC in respect of a levy on energy and gas profits, and Capricorn Energy Plc and Capricorn Energy UK Limited (collectively “Capricorn”) pursuant to a settlement agreement. The Plan is intended to enable Waldorf to continue to trade while pursuing a solvent sale. HMRC and Capricorn voted against the Plan, which Waldorf then sought to have sanctioned. The court has discretion to sanction a Part 26A restructuring plan where a class of creditors dissent to the plan, if it is satisfied that none of the members of the dissenting class would not be “any worse off” under the plan than they would be in the event of the “relevant alternative”. For this purpose, the “relevant alternative” is whatever the court considers would be most likely to occur in relation to the company if the plan were not sanctioned. On 19 August 2025, Hildyard J declined to exercise his discretion to sanction the Plan. While considering that none of the members of the dissenting class of creditors would be any worse off than in the relevant alternative, he found that Waldorf had not discharged the burden of showing that the Plan is fair and appropriate, just and equitable. On 9 September 2025, Hildyard J handed down a further judgment, permitting Waldorf to make an application for permission to appeal direct to the Supreme Court in respect of his decision to decline to sanction the Plan, without first applying to the Court of Appeal. The Supreme Court granted permission in October 2025.