News and Insights

Case briefing: In the matter of Bathroom Brands plc

Facts

A Jersey plc, whose four classes of shares were not listed, sought to cancel them all, reissue all its shares to a new, private, English parent company which would then issue shares in identical numbers and classes back to the original shareholders. This was part of a plan to leave Jersey and relocate the business to the UK.

Decision

To make such schemes of arrangement binding on the shareholders the three requirements of CJL Art 125 must be followed, first seek an order convening a meeting of shareholders and creditors, second put the scheme to the shareholders at the meeting and third ask the court to exercise its discretion to sanction the arrangement. That sanction will be given if the requirements of the law are met, there is no mala fides coercion of a minority and an honest and intelligent shareholder acting in his interests would approve of the plan.

Principle

This case is a text book example of how to conduct this exercise. Things would have been a lot easier if England had continuance rules, but it doesn’t.