Stephenson Harwood advises Transportation Partners on Lion Air Group restructuring

The restructuring, which involved more than 200 aircraft and 50 lessor groups, was necessary to deal with the financial impact of the Covid-19 pandemic on the airline group.

From the outset of the Covid-19 pandemic, the Lion Air Group engaged its lessors in bilateral discussions to restructure financing arrangements in the context of the sudden, sustained drop in air traffic. 

The restructuring involved voluntary collective proceedings in France that commenced in June 2021 in respect of the Ciel Group of companies. The Ciel Group, comprising a number of French companies, leases aircraft to the Lion Air Group. The Commercial Court of Paris approved the exit of these companies from the collective proceedings on 14 November 2022.

The Lion Air Group achieved its lease restructurings through bilateral agreements, while maintaining operations of the group airlines at all times. These discussions were led by the team at Transportation Partners and, by the end of September 2022, bilateral agreements were reached with all of the Group’s relevant lessors.

"We worked with our long-standing client for a period of 18 months in a project that involved over 200 aircraft and around 50 lessor groups" said Saugata Mukherjee, partner, Stephenson Harwood. "Achieving the commercial agreements between the airline group and its business partners was paramount. This required an over-arching contractual framework and support from the judiciary. We are grateful for the support of the judicial administrators, French and English courts in achieving a successful outcome; a process that took time and in which several new legal principles and precedents were established in domestic and cross-border insolvency law - both in England and France. As a firm, we were able to draw on our aviation finance, litigation and restructuring capabilities across offices in Singapore, Paris and London."

The Stephenson Harwood cross-office team advising Transportation Partners was led by Singapore-based partner Saugata Mukherjee and managing associate Clement Leung. The team included: of counsel Michelle Runagall Orlic, associates Yumi Bong, Saurabh Negi, Sean Lim and Bryan Liang, and paralegal Shahrzad Alavi; Paris-based partners Nicolas Demigneux, Olivier Couraud and Yann Beckers, of counsel Alexandre Koenig, and associates Guérin Loisel and Maria Miller; and London-based partner Paul Phillips, managing associates Johnny Champion and Caleb Bompas, and associate Patrick Bettle. External counsel were provided by Fountain Court Chambers (Akhil Shah KC and Giles Robertson) and South Square (Tom Smith KC and Charlotte Cooke).

The legal team at Transportation Partners was led by Rebecca Cox with assistance in France from Pauline Debrand. The Ciel Group was advised by Boché Dobelle Avocats in Paris. Lessor groups were represented by various counsel.