CR-2025-001156 - [2025] EWHC 2129 (Ch)

Despite withdrawing its 2021 winding-up petition against USL, Outrider served a statutory demand against USH on 2 September 2022. Outrider issued letters of demand against MOL and MOSA on 6 September 2022, seeking payment under the Guarantee, albeit no statutory demand or petition was presented then. Outrider presented a winding-up petition against USH on 29 September 2022 for the (then) unpaid sum of US$45m under the Facility Agreement.

On 27 March 2023, USH was placed into provisional liquidation in Bermuda. Mr Michael Morris and Mr Charles Thresh of Teneo (Bermuda) Limited were appointed as Joint Provisional Liquidators of USH (JPLs). Following their appointment, the JPLs began approaching potential investors to realise USH’s assets, principally comprising its shares in MOSA and MOL and the intercompany facilities as between USH and MOL and USH and MOSA (Intercompany Loans). Mr Reynolds describes the marketing process undertaken from 2 to 12 May 2023, with eight potential investors taking part in the open bidding process, five of them making bids for the assets of the former Group.

At the beginning of the marketing process, the JPLs’ fees as well as MOSA’s operational costs were funded by Outrider and, from 2 October 2023, by BMK. Outrider sought to participate in the marketing process with an entity called Al-Braik Investments LLC (ABI).

In the event, the JPLs agreed to sell to BMK USH’s remaining shares in MOL and MOSA, and the Intercompany Loans for a final sale price of approximately US$2.04m, including JPL’s fees of approximately US$1.8m, US$230,000 in costs and expenses and US$300,000, representing Outrider’s costs as petitioner.

The JPLs and BMK concluded an Asset Purchase Agreement on 21 December 2023 (APA), conditional upon an order for sanction from the Supreme Court of Bermuda (clause 2.2(a)). Clauses 3.2(b) and 3.3 of the APA also contained provision for Outrider to agree to release MOL and MOSA from the Outrider Guarantee in return for payment of ‘Contingent Consideration’ (as defined in the APA). Outrider did not agree this.

The JPLs applied to the Supreme Court for sanction on 22 December 2023. Outrider opposed sanction. The application was heard in February 2024 before Subair Williams J. Judgment was handed down on 2 April 2024 (Re US Holdings Ltd [2024] SC (Bda) 11 Civ).

One of Outrider’s main grounds of opposition was that the sale was “anything but lucrative and yields no return for which payment could be secured to satisfy the debts of any class of unsecured creditor”. The Bermudian Court recognised that the price payable by BMK comprised essentially the costs, fees and expenses of the provisional liquidation without a premium and how Outrider was, at that stage, a larger creditor than BMK. It nevertheless sanctioned the sale to BMK. MOL says that this is significant in the context of the new (primary) RA advanced by Outrider at the Sanction Hearing.

Outrider appealed against the sanction order but withdrew the appeal on 11 April 2024.

Following the Bermuda sanction judgment, the APA completed, USH was dissolved and the JPLs were discharged from office.