Tuesday, January 15, 2013

Reconstruction and Amalgamation

Reconstruction and Amalgamation

The company wished to avoid being wound up and negotiated a scheme in which the existing shareholdings in the company would be transferred to a new company which would take over the company’s undertaking and assets as well as its debts. This was to be effected by a scheme for reconstruction which would result in the old company’s shareholders holding four per cent of the shares in the new company.

Notwithstanding the heritage of schemes of arrangement which can be traced back to the United Kingdom in the 1860s, and the common origins of schemes in Australia and Singapore and an established body of legal principles, there is a notable degree of inconsistency in the line of judicial authorities on the nature of schemes of arrangements.
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