Protection of Dissenters’ Rights | Bona Film Group Limited

In a recent case before the Grand Court of the Cayman Islands (“Court”) Walkers, along with Robert Levy QC as leading counsel, has successfully argued that a dissenting shareholder in proceedings commenced under section 238 of the Companies Law (2016 Revision) (“Law” and “Fair Value Proceedings”) is a contingent creditor and has standing to petition the Court for the winding up of the target company in a merger (the “Company”) and that, in the circumstances of the case, it was appropriate for provisional liquidators to be appointed to the Company.

In this case, the dissenting shareholders, which are all funds managed by Hong Kong based fund manager Maso Capital, had their shares cancelled as part of a management buy-out that was completed by way of statutory merger under Part XVI of the Law and exercised their statutory right to dissent from the merger.

In the first case of its kind in a section 238 case, and following the presentation of a winding up petition by the dissenters, the Court was asked to exercise its discretion to appoint provisional liquidators to the Company. At the same time, the Company sought orders that the winding up petition be struck out on the basis that inter alia the dissenters did not have standing to present it.


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Rupert BellPartnerT +1 345 914

Joanne CollettPartnerT +852 2596