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HCMP 6/2022
[2022] HKCFI 2342
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS NO 6 OF 2022
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IN THE MATTER OF M-Resources Group Limited |
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and |
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IN THE MATTER OF section 673 of the Companies Ordinance (Cap 622) and Order 102 rule 5(1)(h) of the Rules of the High Court (Cap 4A) |
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Before: Hon Harris J in Court
Date of Hearing: 22 July 2022
Date of Decision: 22 July 2022
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D E C I S I O N
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1. I have before me a petition seeking the court sanction of a scheme of arrangement between the Company and its unsecured creditors, the purpose of which is to compromise the Company’s unsecured debt.
2. On 21 March 2022 I ordered the convening of a meeting of creditors to consider the scheme. The meeting took place on 25 April 2022. The scheme was passed by 95.4% in number and 81.6% in value of creditors present and voting in person or by proxy. No creditor has attended court to oppose the petition. I understand that one creditor attended the meeting and voted against the scheme. On 21 July 2022 my Clerk received a letter from solicitors for that creditor indicating that the creditor would not attend this hearing and oppose the scheme. The creditor is now neutral in respect of the present application.
3. The Company is incorporated in Bermuda and listed on the GEM Board of the Hong Kong Stock Exchange. Its shares are currently trading. It is clear from the evidence that the Company is insolvent. The Company’s position is that if it were put into liquidation it is doubtful whether the amounts realised by a liquidator would even be sufficient to cover the costs of the liquidation.
4. The compromise that is proposed is very straightforward. In broad terms creditors are offered a choice between accepting a small cash payment or shares in exchange for releasing their claims against the Company.
5. The relevant legal principles are well-established. It is not necessary for me to recite them in any detail, they can be found summarised in Re Moody Technology Holdings Limited[1]. It is clear that they are satisfied in the present case. I am also satisfied that the meeting was properly convened and that the information with which I have been provided demonstrates that necessary statutory majorities were easily obtained.
6. As I have mentioned the Company is incorporated in Bermuda and it is listed in Hong Kong. In my view, there is clearly sufficient connection between the purpose of the scheme and Hong Kong, namely, for the company to retain its listed status, to justify the Hong Kong court exercising its jurisdiction to sanction the present proposed compromised.
7. I will, therefore, make an order in the terms of the draft that has been presented to me.
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(Jonathan Harris)
Judge of the Court of First Instance
High Court
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Mr Vincent Lung and Ms Leticia Tang, instructed by Robertsons, for the company
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