Apr 2012
CAYMAN ISLANDS
GRAND COURT
COMPANIES – SCHEME OF ARRANGEMENT – MAJORITY IN NUMBER
On an application for sanction of a scheme of arrangement under Section 86, the Court again considered the proper manner in which the “headcount” aspect of the approval requirement should be calculated where a custodian holds a number of shares for investors.
The traditional approach of the Courts as to the position of a custodian, assuming it is instructed to vote some of its shares in favour of and some against the scheme, has been to treat the custodian for the headcount test as one vote “for” and one vote “against.”
In the Little Sheep case, the petitioner argued that for the purposes of the headcount test a custodian should be counted as one person having voted either “for” or “against” the scheme depending on its net voting position.