RE UNIROSS BATTERIES (HK) LTD

HCCW 9/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 9 OF 2009

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D E C I S I O N

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1.  This is an application for the appointment of provisional liquidators for UNIROSS Batteries (HK) Limited (“the Company”).  The application was first heard before Chung J on 16 January 2009.  He adjourned it to give the petitioning creditor which is the applicant an opportunity to file further evidence to deal with the concern he raised regarding the stance of the administrator appointed by a court in France in safeguard proceedings under the French Code of Commerce.

2.  Further evidence has been filed on 23 January 2009.

3.  In short, the Company and its parent company, UNIROSS Batteries SAS, support the application to appoint provisional liquidators, as evidenced by a letter dated 15 January 2009.

4.  The French administrator in a letter dated 21 January 2009 confirmed his position that the commencement of winding-up proceedings in Hong Kong against the Company does not conflict with the safeguard proceedings of the Company and its parent companies in France, notwithstanding that he is attempting to come up with a rescue plan for the UNIROSS group of companies before the end of the 6-month observation period in April 2009.  He confirmed his agreement to the commencement of the winding-up proceedings and stated he will co-operate as much as possible with the provisional liquidators appointed by the Hong Kong court.

5.  The debt of the petitioner is not disputed by the Company, as appeared from the letter of the Company dated 2 January 2009.

6.  The purpose of appointing provisional liquidators is to preserve the status quo and protect the assets of the Company.  There is a need for provisional liquidators notwithstanding the petition is scheduled to be heard on 11 Mach 2009.  There is evidence before the court that some of the creditors are likely to help themselves to the assets of the Company.  The administrator in France has been unable to communicate with the suppliers of the Company in Mainland China, and his efforts to obtain information from them and from other parties in China have been fruitless.  This is hampering the progress in the safeguard proceedings, and is driving the Company further into insolvency.  If the Company is falling deeper into debt, there is real possibility that the administrator may recommend that the Company be left out of the restructuring, and that the rest of the group be saved, so that the Company’s creditors would have to fight over what is left, and that would hardly be in their interests.  The provisional liquidators to be appointed are to facilitate communication so that the Company may continue with such operations that are profitable and thereby to increase the assets of the Company, to run the operations of the Company to minimize losses, to deal with tax fines imposed on the Company by the Mainland authorities, and generally to protect the rights of the creditors.

7.  The Official Receiver has taken a neutral position in this application.

8.  I think it would be appropriate in these circumstances to appoint provisional liquidators.  I therefore make an order in terms of the draft order submitted to me with the amendments indicated thereon.