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We are pleased to have collaborated with the Loan Market Association (LMA) in producing a new LMA Insights paper, “Distressed Disposals and Non-Pro Rata LMEs.”
The paper examines how distressed disposal provisions under English law-governed intercreditor agreements are increasingly being used to facilitate liability management exercises (LMEs) and non-pro rata outcomes for creditors whose claims rank equally under an intercreditor agreement. In particular, the paper covers:
- how distressed disposal provisions operate under English law-governed intercreditor agreements
- the use of distressed disposals in LMEs to deliver non-pro rata outcomes, as demonstrated by the 2025 Selecta uptiering LME
- recent litigation in Selecta, Hunkemöller and Hurtigruten, and the growing focus on the abuse of power principle
- what could be next.
Read the LMA Insights paper.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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