Re Aether Ltd

HCCW 397/2020

[2021] HKCFI 2647

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES WINDING-UP PROCEEDINGS NO 397 OF 2020

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Before: Hon Harris J in Chambers

Date of Hearing: 2 September 2021

Date of Decision: 2 September 2021

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D E C I S I O N

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1.I have before me an application by China Cinda (HK) Assets Management Co Limited (“Cinda”) for a validation order under section 182 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, Cap 32. The transaction that Cinda wishes validated is the transfer to it, of 51% of the shares of the Company over which it has security. The security has been given in conjunction with facilities made available by Cinda to associated companies of the Company.

2.The reason why the validation order and indeed the transfer is sought, it being on the face of the matter somewhat surprising that Cinda would be concerned about registering its interest in the shares of an insolvent company, is as follows.

3.The Company owns one valuable asset, property in Beijing.  Cinda anticipates that it will be possible for that to be sold for an amount in excess of the Company’s debts, thus leaving money available for distribution to shareholders.  It also believes that as an experienced asset management company in China, it may be able to assist the sale of the property by the joint and several provisional liquidators of the Company in conjunction with the receiver appointed over the other 49% of the shares in the Company.

4.Neither the provisional liquidators nor the receiver object to this application.  As the shares are fully paid up on the face of the matter it would appear that the transaction will not prejudice creditors which is the normal consideration which influences the court in determining applications for validation orders[1].

5.As there appears to be no reason to think that there might be any indirect disadvantage to creditors of the court confirming what is effectively, simply the registration of the ownership of the 51% of the shares in Cinda’s name, I will make an order in the terms of the draft presented to me validating the share transfer.

6.There will be no order as to the costs of the application.

Mr Robin Darton, of Tanner De Witt, for the applicant (China Cinda (HK) Assets Management Co Limited)

Attendance of the joint and several provisional liquidators, Mr Pui Chiu Wing and Mr Iu Chi Leung, were excused

The joint and several receivers and managers were not presented and did not appear

Attendance of the Official Receiver was excused