RE BURLINGTON WORLDWIDE LTD

RE BURLINGTON WORLDWIDE LTD

The court was satisfied on the evidence that the Articles and special resolution authorized the reduction, that shareholders were equitably treated and informed, creditors were reasonably safeguarded given no existing creditors and parental undertaking, and the reduction served a clear purpose in a corporate...

Source-derived case information.

Citation
RE BURLINGTON WORLDWIDE LTD
Parties
Petitioner: Burlington WorldWide Ltd; Shareholder: Burlington Industries LLC; Shareholder: Burlington Worldwide Inc; Ultimate Parent: International Textile Group, Inc
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
11 March 2014
Case Number
HCMP283/2014
Procedural Posture
Capital Reduction Application Under Companies Ordinance (cap. 32) / Judgment and Court Confirmation Hearing
Outcome
Court confirmed the special resolution and granted the order sanctioning the reduction of capital
Legal Topics
Capital Reduction, Shareholder Approval, Creditor Protection, Court Confirmation Under Ss59 60
Source Language
en
Company Law Corporate Reorganisation Capital Reduction Shareholder Approval Creditor Protection Court Confirmation Under Ss59 60

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Parties

Burlington WorldWide Ltd

Petitioner

Burlington Industries LLC

Shareholder

Burlington Worldwide Inc

Shareholder

International Textile Group, Inc

Ultimate Parent

Procedural Posture

Capital Reduction Application Under Companies Ordinance (cap. 32) / Judgment and Court Confirmation Hearing

Legal Issues

  1. 1 Whether statutory requirements for reduction of capital under s58 and confirmation under ss59-60 were satisfied
  2. 2 Whether shareholders were treated equitably and informed
  3. 3 Whether creditors were reasonably safeguarded

Ratio Decidendi

The court was satisfied on the evidence that the Articles and special resolution authorized the reduction, that shareholders were equitably treated and informed, creditors were reasonably safeguarded given no existing creditors and parental undertaking, and the reduction served a clear purpose in a corporate reorganisation; accordingly the court confirmed the capital reduction and made the order sought.

Court Disposition

Court confirmed the special resolution and granted the order sanctioning the reduction of capital

Orders

  • Order confirming reduction of share capital under s60(1) Companies Ordinance and granting petition in terms of the amended draft order
  • Return of excess capital totalling HK$36,270,001.86 to shareholders (HK$36,270,001.86 to Burlington Industries LLC and HK$0.93 to Burlington Worldwide Inc) by set-off against inter-company loan