Event and Time
Event Description
On August 22, 2024, the court ruled on an application by joint and several deed administrators of Infinite Water Holdings Ltd (IWH) under section 444GA of the Corporations Act 2001 (Cth). The administrators sought leave to transfer shares of IWH from existing shareholders to the Proponents (Tri-Force Enterprise Ltd, Mr. Gheorghe Duta, and Victory Asia Investment Ltd) as part of a deed of company arrangement (DOCA).
Application and Claims
- Application: Under s 444GA of the Corporations Act 2001 (Cth) for leave to transfer existing shares in IWH.
- Claims:
- Administrators: Argued that the proposed share transfer would not result in unfair prejudice to the shareholders because the shares were of nil value. - Objections by Shareholders: Some shareholders contended that the intellectual property assets of IWH had greater value than assessed and opposed the transfer of shares.
Judicial Decisions
- The court granted the plaintiffs leave to transfer shares under s 444GA of the Corporations Act 2001 (Cth), confirming that the proposed transfer would not unfairly prejudice the interests of the shareholders.
Dispute Points and Legal Basis
Dispute Points
- Plaintiffs (Administrators):
- Asserted that the shares had no residual value and that the DOCA offered the best outcome for creditors. - Presented evidence showing IWH's debts exceeded its assets, supporting claims of nil shareholder value. - Argued that liquidation would result in a worse outcome for creditors than the DOCA.
- Defendants (Objecting Shareholders):
- Claimed that IWH's intellectual property had value exceeding the Administrators’ assessment and that they would suffer loss from the share transfer. - Alleged misconduct by the administrators and questioned the independence of the expert valuation provided by Mr. Taylor.