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Re Asia Today Ltd

Judgment Cited authorities 3 Cited in Precedent Map Related
Vincent
Judgment Date17 December 2021
Neutral Citation[2021] HKCFI 3841
Judgement NumberHCCW76/2020
Subject MatterCompanies Winding-up Proceedings
CourtCourt of First Instance (Hong Kong)
HCMP1368/2021 RE ASIA TODAY LTD (In Provision Liquidation)

HCMP 1368/2021 and HCCW 76/2020
(HEARD TOGETHER)

[2021] HKCFI 3841

HCMP 1368/2021

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1368 OF 2021

____________________

IN THE MATTER OF Asia Today Limited (In Provision Liquidation)

and
IN THE MATTER OF Section 670 of the Companies Ordinance, Chapter 622 of the Laws of Hong Kong

____________________

AND HCCW 76/2020

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES WINDING-UP PROCEEDINGS NO 76 OF 2020

____________________

IN THE MATTER OF Section 193 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32)

and
IN THE MATTER OF Asia Today Limited

____________________

(HEARD TOGETHER)

Before: Hon Harris J in Court

Date of Hearing: 17 December 2021

Date of Decision: 17 December 2021

_________________

D E C I S I O N

_________________

1. I have before me a petition seeking sanction of a scheme of arrangement introduced by Asia Today Limited (“Company”) with its unsecured creditors (“Scheme” and “Scheme Creditor” respectively). The Company is incorporated in Hong Kong. The Company is the holding company for a business group which engages in international apparel and fashion. Its core business involves retailing in Germany and Austria.

2. The group’s retail arm in Europe suffered great losses during the COVID outbreak and went into insolvency proceedings in Germany and Austria, thereby causing the Company’s balance sheet and cash flow insolvency. On 27 March 2020, the Company issued a winding up petition against itself and applied for the appointment of provisional liquidators, who were appointed by order of this court on the same day. On 21 December 2020 the court granted the provisional liquidators restructuring powers which led to the introduction of the present Scheme.

3. The ultimate beneficial owners of the investor who has agreed to inject fresh capital into the Company, include the Company’s management, an ultimate major shareholder and a creditor of the Company. The investment is thus akin to a management buy-out.

4. The Scheme is quite straight forward. It provides for a cash distribution spread out over monthly instalments, which if introduced successfully will result in an estimated recovery of between 55% and 56.5% for unsecured creditors, which is considerably better than the estimated return on a liquidation of between 4.5% and 8.3%.

5. The Company’s total debts owed to the Scheme Creditors, amount to approximately HK$218 million. At the meeting convened pursuant to the order that I made on 21 September 2021, all those who attended, representing HK$113.6 million of the unsecured debt, and totalling 48 unsecured creditors, voted in favour of the Scheme. No Scheme Creditor has appeared before me today to contest the petition.

6. In considering whether to sanction a scheme, the court applies some well-established principles which were recently restated in Re China Singyes Solar Technologies Holdings Ltd[1]such that the court would consider in particular the...

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