Iguanas Holdings Limited, Re [2026] EWHC 1229 (Ch)
[2026] EWHC 1229 (Ch)Case No CR-2026-001186IN THE HIGH COURT OF JUSTICECHANCERY DIVISIONBUSINESS AND PROPERTY COURTS OF ENGLAND AND WALESVenue Royal Courts of Justice, Rolls Building, Fetter Lane, London, EC4A 1NLDate 6 May 2026
Before
The Honourable Mr Justice Hildyard
Between
IN THE MATTER OF IGUANAS HOLDINGS LIMITEDIN THE MATTER OF THE COMPANIES ACT 2006Mr Ryan Perkins (instructed by Macfarlanes LLP) for ApplicantHearing Hearing dates: 6 May 2026APPROVED JUDGMENTWARNING: Reporting restrictions may apply to the contents transcribed in this document, particularly if the case concerned a sexual offence or involved a child. Reporting restrictions prohibit the publication of the applicable information to the public or any section of the public, in writing, in a broadcast or by means of the internet, including social media. Anyone who receives a copy of this transcript is responsible in law for making sure that applicable restrictions are not breached. A person who breaches a reporting restriction is liable to a fine and/or imprisonment. For guidance on whether reporting restrictions apply, and to what information, ask at the court office or take legal advice.This Transcript is Crown Copyright. It may not be reproduced in whole or in part other than in accordance with relevant licence or with the express consent of the Authority. All rights are reserved.
[1]At this convening hearing, Iguanas Holdings Limited, which I shall call “the Plan Company” or “IHL” as the case may be, has applied to the Court to direct class meetings of its creditors for them to consider and (if they see fit) approve a restructuring plan proposed by the Plan Company under Part 26A of the Companies Act 2006, which I shall refer to as “the Act”.[2]The Plan Company operates a chain of restaurants across the United Kingdom under the Las Iguanas brand. The Plan Company is a party to leases across its 44 leaseholder sites, and is liable both for rent and also business rates in respect of them. The Plan Company is part of a group of which the ultimate holding company is Isabela Topco Limited and the group comprises of its subsidiaries.[3]The Plan Company’s operating activity is undertaken under the umbrella of The Big Table Group Limited which employs all staff working in its restaurants and all contracts and arrangements with suppliers. In addition, The Big Table Group Limited provides management and support services including its financial, human resources, IT, marketing and other operations. The revenue and costs specific to each Plan Company restaurant, along with essential costs which are not specific to the Las Iguanas brand, are recharged to the Plan Company by The Big Table Group Limited. The Las Iguanas brand itself is owned by Pinta Brands Limited, another group entity which licenses the brand to the Plan Company in return for their licence fee.[4]The Plan Company has fallen into considerable financial difficulties in recent years. This is in current economic circumstances not unusual in the service sector, especially at present in the restaurant and other retail operations. In the event, it has only been able to continue trading by receiving financial support from its Parent, The Big Table Group Limited. The directors of the Plan Company have formed the view, in light of those losses, that that it will have to enter into formal insolvency proceedings unless a restructuring plan is adopted which results in its Parent considering that it is worth supporting into the future.[5]The alternative envisaged (in the language of Part 26A, “the Relevant Alternative”) is a prepack administration. That would not be as beneficial, by some considerable margin, as what is proposed, at least according to the expert evidence which has been provided.[6]The purpose of the Plan therefore is to rescue the Plan Company from insolvency as part of a broader turnaround strategy funded by its Parent and thereby to avoid a heavily discounted insolvency sale.[7]Put simply the plan has four separate features. First, the plan will release liabilities owed by the Plan Company to its secured creditor, another group company, Floreana Midco Limited (“the Secured Creditor”), which is a holding company of the Parent (and thus indirectly a holding company of the Plan Company). The secured debt amounts to approximately £37 million.[8]Secondly, the Plan will facilitate an injection of £3 million of new money in the form of interest-free secured loans which it is intended will be used to try and increase capital expenditure so as to implement the Plan Company’s turnaround strategy.[9]Thirdly, the Plan will compromise the liabilities owing to four classes of landlord creditors (“the Landlord Creditors”) which (for the purpose of the Plan) have been divided into classes B1, B2, B3 and C. Initially when the Plan was put before the Court, it also extended to the compromise of liabilities of another group of Landlord Creditors described as Class A landlords, which was in fact the largest group of landlords. In circumstances which I will come onto describe, the Plan has since been amended to exclude from consideration those Class A Landlord Creditors.[10]The division of the remaining Landlord Creditors into four main groups has been by reference to the profitability of the relevant restaurants in the relevant premises. In short, under the Plan, rent reductions would be imposed on the Landlord Creditors and other changes would be made to the terms of the leases to improve their economic profile and financial profile from the point of view of the Plan Company. The remaining four classes are determined according to the percentage contractual rent reduction needed to enable the restaurant at the premises in question to make a sustainable EBITDA contribution. Thus, under the Plan, Class B1 Landlord Creditors would have the rent reduced by 25%; Class B2 would have a rent reduction of 50%; Class B3 would have a rent reduction of 75%; and Class C leases are of branches which are not forecast to make a sustainable EBITDA contribution even if the contractual rent is reduced by 75%. The classification of each individual lease is set out in Schedule 5 of the Plan {7/394}, and a breakdown is shown below:[11]Fourthly, the Plan will compromise unsecured liabilities owing to two other classes of creditors referred to and defined in this plan as the “General Property Creditors” and the “Business Rates Creditors”.[12]The terms of the Plan have been designed in such a way that it is anticipated that the Landlord Creditors, the General Property Creditors and the Business Rates Creditors, being the three constituencies affected by this Plan, would be better off than they would be in the Relevant Alternative, it is estimated by a factor of at least two.[13]This is not the occasion to set out the detailed terms nor to weigh their fairness. It has been repeatedly emphasised, especially by David Richards J (as then was) in Re Telewest Communications plc [2004] BCC 342 at [14] that a convening hearing at which the court considers whether the plan should proceed and what meetings should be convened for the purpose of considering the plan is “emphatically not” the time to consider the fairness of the plan proposed.[14]Rather, the agenda for hearings of this kind is first to consider whether the jurisdictional preconditions stipulated by Part 26A have been satisfied. Secondly, to approve (or not) the plan company’s proposals as to the composition of the various classes which is required to enable creditors to consult together constructively to determine whether to approve the proposed plan. Thirdly, to be satisfied that sufficient notice and information has been provided to enable creditors to assess the plan on an informed basis. Fourthly, and as the recent Practice Statement emphasises, the convening hearing also offers an opportunity to identify and discuss any of what are called “roadblocks” to the scheme and any ‘blots’ or impediments which are likely to have to be determined in advance or may themselves demonstrate that the plan is unworkable for some reason or not acceptable.[15]I am grateful to Mr Perkins, who has presented this application on behalf of the Plan Company and has as ever, if I may say so, provided me with exemplary submissions in elaboration of his very clear skeleton argument. He has informed me that he believes this to be the first Part 26A plan to be proposed under the umbrella of the new Practice Statement.[16]As to the jurisdictional preconditions, the Court must be satisfied that the Plan Company is a “company” and that the Plan proposed is a “compromise or arrangement” within the meaning of the provisions. I am satisfied as to both. The Plan Company is registered in England; and what is proposed constitutes an arrangement within the meaning of the relevant provisions of the statute. In that context the court adopts a fairly wide or permissive stance in determining whether the plan involves the requisite give and take, and if it can be satisfied as to that it is inclined not to measure the amount given and taken but simply to be satisfied that something has been done on either side. I have no doubt in this case that the requirement of give and take is satisfied and that this is an arrangement which can proceed on that score.[17]Where, as here, Part 26A is invoked, the Court must be shown that the relevant conditions in (A) and (B) in section 901A of the Companies Act 2006 appear to be satisfied. I think I can short-circuit this by saying that it is plain in my view that in this case those requirements are so satisfied: both condition A and condition B seem to be fulfilled.[18]I must also be satisfied that the relevant requirements at the points of notification and information have been provided in due time before this hearing in order to alert those concerned to allow them to have the opportunity to make such observations as they think are appropriate. The new Practice Statement particularly emphasises the importance of this. In this case the practice statement letter was sent some 35 days ago and that is well sufficient in my view, having regard to the context, to satisfy any requirements in that regard. I am also satisfied, although I shall have to return to the detail of the practice statement letter later, that it is in an appropriate form and covers the necessary matters required to be covered in order to give an appropriate description of what is proposed.[19]Sometimes at convening hearings a potential roadblock to the exercise of the jurisdiction is identified in the form of some uncertainty whether the plan may not be recognised or enforced in any relevant foreign jurisdiction. Here there is no such problem, except what might be a footnote in a sense that there is a single lease property in Glasgow which is governed by Scots law. However, Mr Perkins has referred me to the case of Phillips v Allan (1828) 108 ER 1120, which is now I think nearly 200 years old, demonstrating that, as one would expect in an English insolvency process of this kind it is automatically recognised and enforced across the border.[20]At all times, especially in the context of Part 26A plans, it is important to have regard to what is suggested to be the ‘relevant alternative’, since that is a principal part or element of the statutory architecture whereby both the composition of classes and the overall fairness of what is proposed is assessed. In that regard I have been shown already two reports prepared by independent experts, one to consider the Relevant Alternative and the other to consider what advantages and benefits are likely to emerge under the Scheme and what share should be enabled in respect of them. Under the draft Order which has been submitted, the approval of the court to give permission to rely on the contents of those expert reports is a matter that is urgently sought and, for reasons which I shall return to, they are plainly appropriate.[21]To move on to the central issue which is required to be addressed, that of class constitution, what is proposed is that there would be in total seven meetings. One would be of the Secured Creditor. It is obviously appropriate that that entity should be included in a meeting on its own because, at least in theory, it has an entirely different perspective than unsecured creditors.[22]The other classes comprise first the different categories of the Landlord Creditors: the Class B1 landlords, the Class B2 landlords, the Class B3 landlords and fourthly the Class C landlords. The other two classes are a single class of Business Rates Creditors and a single class of the General Property Creditors.[23]The justification for separate classes of the Landlord Creditors is that each class of landlord is treated in a materially different way under the plan. As I have explained, the fairness of this differential treatment may be a matter for consideration at the sanction hearing, but I agree with the submissions made to me that there can be no doubt that at least four classes of landlords are required.[24]The question then arises whether more than four classes are necessary, given slightly different perspectives or interests of the four identified groups. The question is whether there are elements in the overall arrangements introducing a potential difference in the way that some creditors view what is proposed and accordingly, that fracture the classes.[25]As to this, Mr Perkins has shown me that each lease is for a different term of years. However, if every lease with a different term of years were to be accommodated in a separate class that would lead to an unwieldy and unnecessary proliferation of classes. I do not consider this as a fracturing element. It seems to be clear that despite the different duration of the leases, there is very much more to unite than divide the landlord creditors within each of the four classes identified.[26]A second potential fracturing element which might be thought to require a separate or additional class is that some of the leases included within them provision for the payment of turnover rent. That is to say an additional amount based on the turnover of the relevant premises. However no turnover rent would be paid by the Plan Company in the Relevant Alternative for the simple reason that the Plan Company would not continue trading. In consequence, in my view, the contractual right to receive turnover rent does not give rise to substantive differences in the rights in the Relevant Alternative. Furthermore, no turnover rent would be paid under the Plan to the landlords in Class B1, B2, B3 and C in any event. So, to some extent if not completely that point falls away by reference to the modification of the Plan.[27]A third matter to consider is that the landlord in Glasgow previously mentioned has a security right under Scots law, known as a hypothec. This allows the landlord to seize movable property of the tenant. The Plan Company has concluded, and I accept for present purposes, that there is no property at the Glasgow premises which could be seized. It is submitted on that ground that the Glasgow landlord’s recovery in the relevant alternative would not be materially different from that of other landlords and certainly not such as to cause a division which would make it impossible for them to commune together in regard to their common interests.[28]Similarly, the Business Rates Creditors (which consist of local authorities to whom various liabilities are owed in respect of business rates) and the General Property Creditors (which comprise three miscellaneous unsecured creditors, one of which has a contingent claim in respect of a guarantee by the Plan Company of an assigned lease, and two of which have contingent claims for dilapidations in respect of expired leases, as defined in the Plan) are to be treated differently under the Plan and it is therefore necessary for them to vote in separate classes. But I do not consider, from what I have seen in the evidence, that there is any other fracturing element requiring more than those two classes in that regard.[29]It seems to me therefore with the assurance that, in contrast to a number of previous cases, there are no fees or similar benefits that might theoretically have fractured the class on that ground, that the proposed class composition is appropriate. It is plainly not designed to reduce the number of dissenting classes, nor artificially to create an assenting class which might be used as a vehicle for some kind of cram down which might become necessary in due course.[30]I have considered more generally whether there is any other particular reason identified so far which might throw this plan greatly off course. As I should have perhaps noted earlier, no creditor has attended to voice any objections, and none have been received except as regards a Class A creditor which I indicated I would have to address more fully. In that regard, by a letter dated 1 May 2026 Hogan Lovells, on behalf of Meadowhall Nominee One Limited and Meadowhall Nominee Two Limited being the landlords of one of the relevant sites, complained as to the inclusion of Class A landlords within the Plan.[31]It is fair to note that in the case of Class A landlords, unlike landlords in other classes, no reduction of rent was proposed, but it was proposed that the arrangements for payment of rent should be changed from payments in advance to payments in arrears. The complaint was both that that change was not explained and justified in the practice statement letter and furthermore that no adequate consultation had preceded the proposal. Reference was made to a townhall meeting which was held the day before the PSL was dispatched to notify all relevant persons who wished to attend of the basis for the proposals. It was also complained that the practice statement letter only provided an indication of today’s hearing date rather than formal confirmation of it.[32]Suffice to say that the response of the Plan Company was simply to withdraw the proposal as regards the Class A Landlords on the grounds that the problems and delay which argument with that class would entail was simply not a risk that the Plan Company could run in the light of accelerating financial difficulty.[33]All in all, I am content to grant orders in the form of the draft Order intended to exclude the Class A landlords which has been handed up to me. I have indicated that the fact of their omission should be rehearsed and that the correspondence with Hogan Lovells should be recited. I think at least the first witness statement of Adrian Walker dated 21 April 2026 should be expressly identified since that is the main area in which the proposals were explained.[34]I have indicated and discussed helpfully with Mr Perkins as to whether a purely virtual hearing is justified, having indicated to him my reservations as to the extent of this practice post Covid. He has satisfied me in the particular circumstances it is safe and reasonable to provide the meetings in that form but I have indicated and he has accepted that I wish it to be made clear to all persons affected that they have the ability to participate in the meeting, at least to the extent of inviting the chairman to exercise his discretion to allow their participation and that that should be made clearer in the relevant notice.[35]Finally, I should record that the Class A Landlords no longer pursue an application they initially threatened to recover their costs.[36]Accordingly, subject to one point with regard to paragraph 9, which is that I think some greater specificity than the reference to the supplemental bundle might be appropriate, I am content to approve what is proposed and make an order in the form suggested. --------------