Glenn Agre Wins Chapter 15 Recognition in Landmark Cross-Border Restructuring Case of First Impression

Glenn Agre Bergman & Fuentes serves as lead counsel to the foreign representative of ARD Finance S.A., a Luxembourg entity within the Ardagh Group, in a hotly contested Chapter 15 proceeding before Chief Bankruptcy Judge Martin Glenn in the Southern District of New York. This Chapter 15 proceeding considered an issue of first impression: whether to grant recognition to a judicial reorganization proceeding under Luxembourg’s 2023 restructuring law.

ARD Finance carried approximately €860 million and $986 million in senior secured PIK toggle notes, which formed part of the Ardagh Group’s more than $10 billion in consolidated debt.

When an ad hoc group of minority noteholders refused to consent to the proposed restructuring, ARD Finance commenced a judicial reorganization in Luxembourg under the 2023 law. The noteholders responded by filing suit in New York Supreme Court, alleging that the Luxembourg filing itself constituted a breach of the PIK notes indenture. Glenn Agre, on behalf of the foreign representative, sought Chapter 15 recognition of the Luxembourg proceeding in the Southern District of New York.

The noteholders, represented by White & Case, opposed recognition on the grounds that the Luxembourg proceeding was not a sufficiently “collective” proceeding to qualify as a foreign main proceeding and that it violated U.S. public policy because it would not permit them to challenge certain of the restructuring transactions.

The Glenn Agre team prevailed on every issue. The court recognized the Luxembourg proceeding as a foreign main proceeding, rejecting all opposition arguments.

Recognition of the Chapter 15 proceeding delivered two immediate benefits: it triggered an automatic stay halting the $250 million New York state court action and secured U.S. judicial support for the Luxembourg restructuring, clearing a critical path to consummation of the Ardagh Group’s restructuring.

The Glenn Agre team included partners Andrew Glenn and Jon Friedman, and associates Jewel Tewiah, Naznen Rahman, Lindsey Neuberger, and Peter Charnell.