RE CENTURY SUN INTERNATIONAL LTD

HCMP 759/2021

[2022] HKCFI 1237

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 759 OF 2021

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D E C I S I O N

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1.  On 6 October 2021 I delivered a decision[1] determining the Company’s petition seeking an order sanctioning a scheme of arrangement which had been considered by its unsecured creditors on 29 July 2021. I declined to sanction the scheme for the reasons explained in the decision, but I did make an order permitting the Company to convene a further creditors’ meeting and directing that an adequate explanatory statement be produced. There is no need for me to repeat the background to the scheme and my reasoning which is contained in the reported decision.

2.  A second scheme meeting was convened on 25 February 2022. The scheme was approved unanimously by scheme creditors present and voting, in person or by proxy. Those voting for the scheme included the scheme creditors, who had successfully opposed the petition on 6 October 2021.

3.  The petition is unopposed before me today. I am satisfied that the concerns that I explain in my reported decision about the adequacy of the information provided to scheme creditors in the original explanatory statement have been resolved. It is permissible for the court to direct a second scheme meeting and to sanction a scheme at a petition presented relying on the statutory majority achieved at the second scheme meeting[2].

4.  There is one other matter that I should deal with. After the scheme document was dispatched to scheme creditors on 14 January 2022, some minor clarificatory amendments were made to the scheme document and a revised scheme document was dispatched to the scheme creditors on 28 January 2022, nearly a month before the second scheme meeting. I am satisfied that these amendments do not prejudice the court’s discretion to sanction the scheme. As I explained in Re Hong Kong Building and Loan Agency Ltd[3]:

“Amendments were made at two stages, the first was before the meeting took place. One would expect that such modifications would on occasions to be necessary and would be unlikely in any way to jeopardize the Scheme, as long as the amendments are brought to the attention of the Scheme Creditors sufficiently before the meeting in order for them to take them into an account…

[T]here could be nothing in [principle] objectionable to a Scheme document being amended after it has been circulated, as long as those who would be called upon to vote on it are [given] adequate notice of the changes. Indeed, it is normal in my experience for the orders convening the meeting to expressly envisage this.”

5.  I am satisfied that the criteria, which guide the court in considering whether or not to approve a scheme are satisfied and I will make an order in the terms of the draft presented to me.