Cayman Islands Restructuring: Observations Following Petrofac

This article follows our previous commentary on the English High Court's decision in May 2023 to sanction the Adler Group's restructuring plan and the Court of Appeal's reversal of that decision in February 2024. The recent Court of Appeal ruling in Saipem & Ors v Petrofac represents a further development in the evolving jurisprudence regarding the application of Part 26A of the UK Companies Act 2006.

With a corresponding rise in valuation disputes and out-of-court restructuring solutions in Cayman, this appellate guidance is timely and helpful.

Background

Petrofac Limited and Petrofac International (UAE) LLC (together, the "Plan Companies") proposed two restructuring plans under Part 26A of the UK Companies Act 2006 to compromise approximately US$4 billion in liabilities to address financial distress exacerbated by legacy liabilities, including those arising from the Clean Fuels Project in Thailand. The plans were sanctioned by the High Court on 20 May 2025,