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It is well settled that the Cayman Court’s power to order the winding up of a Company is discretionary, section 92 of the Companies Law (2013 Revision) providing that ‘A company may be wound up by the Court if …’. In practice however it is not often that the discretion is not in fact exercised where the Company is in fact insolvent and the debt is not disputed. As Jones J observed in HSH Cayman I GP Limited & Ors v GP Limited & Anor:
‘A winding-up order is a discretionary remedy, but it is well established as a matter of Cayman law that an unpaid petitioning creditor in respect of an unpaid debt is entitled to expect the court to exercise its discretion in his favour by making a winding-up order in the absence of some exceptional circumstances or special reasons.’
Grand TG Gold Holdings Limited (unreported 21 August 2016) is such a rare case where Segal J adjourned a winding up petition upon an opposed application by a Hong Kong listed Company to be allowed more time to progress a restructuring proposal which was ultimately successful and allowed the shares of the Company to resume trading on the Stock Exchange of Hong Kong.
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Grand TG Gold Holdings Limited: Pragmatic Adjournment of a Winding Up Saves a Going Concern Business
This article was first published in International Corporate Rescue.