UK court refuses Adler bondholders right to appeal restructuring plan

Adler SA

25/04/2023 13:34

LONDON, April 25 (Reuters) - A group of Adler Group
 ADJ.DE  bondholders was on Tuesday refused permission by
London's High Court to appeal a restructuring plan for the
German property firm, increasing the likelihood of the plan
going ahead.
    Judge Thomas Leech refused permission to appeal the decision
at the High Court, although the bondholders can go to the Court
of Appeal, and noted a majority of creditors had backed the
restructuring plan.
    The bondholder group did not immediately respond to a
request for comment.
    Adler, one of Germany's biggest landlords, is fighting a
liquidity crisis triggered by a downturn in the German property
market, rising energy and building prices caused by Russia's
invasion of Ukraine and the impact of the COVID-19 pandemic.
    A restructuring plan, put forward by lawyers representing
Adler's English subsidiary, to prevent the firm's imminent
collapse was approved by London's High Court on April 12, even
as some bondholders opposed the decision.    
    The investors, holding Adler notes that mature in 2029 and
including investment firms DWS Investment GmbH and Strategic
Value Partners, opposed the plan, saying they would be better
off if Adler Group were formally liquidated.
    In addition, short seller Viceroy Research in 2021 alleged
the company's balance sheet had been artificially inflated,
accusations Adler rejected at the time.
    Adler Group has external debts of approximately 6.1 billion
euros ($6.7 billion), according to court documents filed by its
English subsidiary AGPS Bondco.
    Under the restructuring plan, the company would borrow 938
million euros of new funding and the terms of unsecured notes
that mature between 2024 and 2029 would be amended.
    Its Chief Financial Officer Thomas Echelmeyer said on
Tuesday the firm wanted to pay off its debt without a complete
break-up of the group, though it will also have to cut jobs.
    Adler Group's share price – which has fallen by 97% since
January 2021 – was up 2.9% to 0.8555 euros at 1215 GMT.

 (Reporting by Chiara Elisei  Editing by Mark Potter)
 ((Chiara.Elisei@thomsonreuters.com;))