This edition of the Deal Report continues the focus on restructuring transactions with a summary of the recent ~US$347 million debt restructuring undertaken by the Australian mining business Wollongong Coal Limited (ASX: WLC).
The transaction involved the restructuring of certain loan facilities via creditors’ schemes of arrangement (Schemes). Prior to implementation, the Schemes terminated automatically by their terms as certain required payments had not been made by the relevant condition precedent satisfaction date.
In order to revive the Schemes, the parties applied for a court order to retrospectively amend the terms of the Schemes to extend the due date of the required payments. The requested orders were granted and the subsequent decision of Justice Black in Re Wollongong Coal Limited; Re Jindal Steel & Power (Australia) Pty Limited  NSWSC 614 confirms that Courts in Australia have the ability to retrospectively amend the timing provisions attached to a scheme of arrangement once approved.
This transaction is significant as market participants now have certainty that, in some circumstances, the Courts will allow for the amendment of an approved scheme, rather than requiring parties to resort to the costly and lengthy process of implementing a second overriding scheme of arrangement.