RE MILLION UP LTD

HCCW 5/2026

[2026] HKCFI 1925

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 5 OF 2026

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REASONS FOR JUDGMENT

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1.  At the hearing of the Petition presented by Vestpro International Limited (“Petitioner”) on 5 January 2026, I made a usual winding up order against Million Up Limited (百陞有限公司) (“Company”). These are the reasons for my judgment.

Background

2.  The Company was incorporated in Hong Kong on 25 March 2003. The Company holds 80% interest in a mining project known as WIM150 in Victoria, Australia (“WIM150”), which is its only substantial asset.[1]

3.  On 3 September 2013, Australian Zircon NL (“AZC”) and Orient Zirconic Resources (Australia) Pty Ltd (“Orient”) entered into a joint venture agreement (“JV Agreement”) pursuant to which AZC and Orient held 80% and 20% interest respectively in WIM150.[2] On 11 April 2016, the Company acquired AZC’s 80% interest in WIM150 and replaced AZC as a party to the JV Agreement.[3]

4.  On 8 August 2018, the Petitioner entered into an asset purchase agreement with the Company to acquire one-sixth of the Company’s interest in WIM150 for AUD 6.25 million (“APA”). The APA did not proceed to completion as Orient, which had a right of first refusal under the JV Agreement, did not consent to the transfer.[4] The dispute between the Petitioner and the Company was referred to the Shanghai International Economic and Trade Arbitration Commission for arbitration (“Arbitration”).[5]

5.  By a partial award dated 2 December 2024 (“Award”), the tribunal ordered the Company to pay compensation to the Petitioner together with costs and expenses of the Arbitration in the amounts of AUD 32,814,228.93, RMB 2,936,581.70 and NTD 60,400 (“Awarded Sum”) by 12 December 2024.

6.  On 6 March 2025, leave was granted to the Petitioner to enforce the Award as a judgment of the court. The Company’s application to set aside the enforcement order was dismissed on 6 November 2025.

7.  On 25 November 2025, the Petitioner served a statutory demand (“SD”) on the Company requiring it to pay AUD 34,790,533.74, RMB 3,113,443.41 and NTD 64,037.71, being the Awarded Sum together with interest accrued up to the date of the SD (“Debt”).

8.  The Company failed to comply with the SD whereupon the Petition was presented on 5 January 2026.

9.  The Company does not dispute the Debt. In the affirmation of Hung Chi Pang Andy dated 15 January 2026 (“Hung 1^st”), the Company seeks an 8 weeks’ adjournment on the ground that it will be able to restore its solvency within 8 weeks in that:

(1) It has since August 2025 initiated discussions with interested investors;

(2) On 29 August 2025, one Mr X agreed to form a syndicate (including himself) to provide finance to the Company;

(3) The 3-page draft cooperation agreement (with identity of Mr X and the counterparty, Party B, redacted) exhibited to Hung 1^st provides inter alia that (a) Party B or the investor shall provide funding by way of capital injection or loan in the amount of no less than AUD 150 million[6]; (b) Party B shall apply for initial public offering for the Company within 5 years in return for a commission[7]; and (c) the Company shall within 2 years of receiving the funds raised complete the necessary environmental assessment and the preliminary steps for applying for licences in respect of the land and mining rights[8];

(4) From September to November 2025, the potential investors conducted expert review of mineral samples from WIM150 and given positive responses to joining the syndicate;[9]

(5) On 10 November 2025, the Company and Mr X met with representatives of an investor. Mr Hung understood that Mr X and the investor agreed to the terms in the draft agreement and will provide funds to the Company in the sum of AUD 150 million upon signing the agreement;[10] and

(6) On 13 January 2026, Mr X told the Company that the investor’s investment committee had approved financing for WIM150, and that Mr X will be in a position to execute the agreement in April 2026 after going through formalities.[11]

10.  The Company claims that its interest in WIM150 is worth AUD 281 million, relying on a valuation report prepared by BurnVoir Corporate Finance Ltd on 29 March 2018 (“Valuation”). The Valuation was relied on by the Petitioner in the Arbitration and was preferred by the tribunal over the more recent valuation.[12]

11.  The Company says that an adjournment of the Petition is in the interests of the creditors[13] because:

(1) a winding up order will trigger an “irremediable default” under the JV Agreement whereupon the Company will be obliged to pay an uncertain amount of compensation to Orient.[14] It will also lead to a forced sale of the Company’s interest in WIM150 at a substantial discount either to Orient (under Clauses 12.1(b) and 13.5 of the JV Agreement) or to a third party (if Orient does not exercise its right of first refusal) as operating WIM150 requires technical expertise which would be lost without the involvement of the current management; [15]

(2) the Company has brought proceedings in Australia against Orient for wrongfully withholding consent to the APA. It expects to receive a favourable judgment against Orient in early to mid-2026, which will enable the Company to have sufficient funds to pay the Petitioner;[16] and

(3) there is little prejudice to the Petitioner as it waited for 3 months before taking steps to enforce the Award in Hong Kong.[17]

Discussion

12.  The principles are well-established. As stated in Re Jiayuan International Group Limited [2023] HKCFI 1254 §12(1)-(2):

“(1) A petitioner whose debt is not in dispute is entitled ex debito justitiae to a winding up order against the company. The burden lies on the company to demonstrate good grounds for the court not to make such an order against it;

(2) Where the company is insolvent and unable to pay its debts, it is the creditors who have a real interest in the company. They can decide whether it is in their interest to have the company wound up. It is not for the company to assert otherwise even if there are valid grounds in support of its assertion”

13.  Where a company seeks an adjournment on the basis that it needs time to arrange or raise funds to pay the petitioning debt, it is incumbent upon the company to adduce credible evidence to show that there is a reasonable prospect that the debt will be paid within the period of adjournment or that there is a repayment proposal which is both precise and credible. The critical question is whether, at the end of the adjournment sought, it is more likely than not that the petitioning debt will be paid in full (Re Trinity (Management Services) Ltd [2021] HKCFI 2207 §§6-7, 11).

14.  There is no dispute that the Company failed to comply with the SD and is deemed insolvent by virtue of s.178(1)(a) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32). The Petitioner is entitled ex debito justitiae to a winding up order against the Company.

15.  In my judgment, the Company has not demonstrated that there is any proper basis for the court to displace the Petitioner’s right to seek a winding up order or to adjourn the Petition.

16.  First, the evidence adduced by the Company does not show that there is a credible repayment proposal. All that the Company is able to show are some messages and a redacted draft cooperation agreement which has not been executed despite the same having been prepared and sent by Mr X in August 2025. The draft agreement does not show the identity of Mr X or Party B. Nor does it show when and how funding is to be provided. Although the Company claims that the draft agreement will be signed in April 2026, no contemporaneous document has been adduced to show that the unidentified investor had agreed to the terms of the draft agreement. Had the (unidentified) investor agreed to provide funding in the amount of AUD 150 million to the Company, it is inconceivable that no document showing the discussions or the terms said to have been agreed can be produced.

17.  Second, as submitted by Mr Thomas Wong, counsel for the Petitioner, even taking the Company’s case to the highest, there is no evidence to show that execution of the draft cooperation agreement will enable the Company to pay the Debt. The terms of the cooperation agreement suggest that the funding, if received by the Company, will be deployed to develop the mine, complete the environmental assessment and preliminary steps for obtaining the licence for the land and mining rights within the next 2 years[18].

18.  Third, the Company has not adduced any financial statements, whether audited or unaudited, to show its current financial position. Without such information, there is simply no basis for the Company to assert that it will be able to restore its solvency if and when additional funding becomes available as much depends on the extent and the nature of its assets.

19.  Lastly, the assertion that it would not be in the interests of the creditors for the Company to be wound up rings very hollow. It is a matter for the Petitioner to decide whether the Company should be wound up in circumstances where the Debt has fallen due for over 15 months but remains unpaid.