RE LEI SHING HONG LTD

RE LEI SHING HONG LTD

The court sanctioned the scheme because the statutory requirements were satisfied: the class was properly constituted, adequate disclosure was given, the meeting was properly convened and overwhelmingly approved the scheme, the reduction served a discernible and proper purpose, and creditors would not be prejudiced; accordingly the reduction of capital was confirmed.

Citation
RE LEI SHING HONG LTD
Parties
Petitioner / Company: Lei Shing Hong Limited; Affected Class of Shareholders / Respondents: Minority Shareholders; Proposed Purchaser / Members Acting in Concert: Best Star Group Limited (and Consortium members)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
13 March 2008
Case Number
HCMP84/2008
Procedural Posture
Scheme of Arrangement and Confirmation of Reduction of Capital Under the Companies Ordinance (cap.32) / Sanction Hearing and Judgment (sanction Granted and Reduction Confirmed)
Outcome
Scheme of arrangement sanctioned; reduction of share capital confirmed.
Legal Topics
Scheme of Arrangement, Reduction of Capital, Minority Buyout, Shareholder Meeting and Voting, Listing Withdrawal, Creditors' Protection
Source Language
EN
Company Law Securities Regulation Corporate Finance Scheme of Arrangement Reduction of Capital Minority Buyout Shareholder Meeting and Voting Listing Withdrawal +1 more

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Parties

Lei Shing Hong Limited

Petitioner / Company

Minority Shareholders

Affected Class of Shareholders / Respondents

Best Star Group Limited (and Consortium members)

Proposed Purchaser / Members Acting in Concert

Procedural Posture

Scheme of Arrangement and Confirmation of Reduction of Capital Under the Companies Ordinance (cap.32) / Sanction Hearing and Judgment (sanction Granted and Reduction Confirmed)

Legal Issues

  1. 1 Whether statutory requirements under s166 (and s166A) of the Companies Ordinance were complied with
  2. 2 Whether the class of members was properly constituted and fairly represented
  3. 3 Whether disclosure to members was sufficient to enable informed voting

Ratio Decidendi

The court sanctioned the scheme because the statutory requirements were satisfied: the class was properly constituted, adequate disclosure was given, the meeting was properly convened and overwhelmingly approved the scheme, the reduction served a discernible and proper purpose, and creditors would not be prejudiced; accordingly the reduction of capital was confirmed.

Court Disposition

Scheme of arrangement sanctioned; reduction of share capital confirmed.

Orders

  • Scheme of arrangement sanctioned by the Court
  • Reduction of authorised and issued share capital confirmed and approved as per draft order (from HK$2,000,000,000 to HK$1,956,622,901)