In a first for the jurisdiction, Mourant Ozannes' Guernsey corporate and litigation teams have successfully opposed the sanction of a proposed scheme of arrangement in the Royal Court of Guernsey.
The law firm acted for a minority shareholder in the takeover of Guernsey-based real estate investment company Puma Brandenburg.
Puma was attempting a takeover of itself by implementing a selective share buyback under a scheme of arrangement mechanic.
The scheme of arrangement, if sanctioned by the Royal Court, would have resulted in the majority shareholder (who is also a Director) acquiring sole ownership of Puma for nil consideration paid by him. Minority shareholders would have received a 43.6 per cent discount to the net asset value of Puma.
At a number of hearings before the Royal Court, Mourant Ozannes contested the mechanics of the takeover, arguing that it was contrary to Guernsey law and was not a transaction that the Royal Court had jurisdiction to sanction.
Additionally, it was argued that the Royal Court should refuse to sanction the scheme on discretionary grounds due, in part, to the insufficient nature of the scheme circular disclosure.
In a judgment delivered on 24 February, the Bailiff agreed that a scheme of arrangement cannot be used by a company to undertake a share buy-back where the shareholder does not consent to that sale.
He went on to find that, in any event, he would have rejected the scheme on the discretionary grounds. A copy of the judgement can be found here.
The Mourant Ozannes team was led by Partners John Rochester and Abel Lyall, supported by Senior Associates Alex Davies and Jamie Bookless, Associates Ryan Hallett, Victoria Thomas and Sophie Williams and London Counsel Andrew Thornton from Erskine Chambers.