Offshore Litigation

Blog

Offshore Litigation

Contributors

Jonathan Addo
Jonathan Addo
  • Jonathan Addo

  • Partner
  • British Virgin Islands
Jeremy Child
Jeremy Child
  • Jeremy Child

  • Partner
  • London
Julie Engwirda
Julie Engwirda
  • Julie Engwirda

  • Partner
  • Hong Kong
Peter Ferrer
Peter Ferrer
  • Peter Ferrer

  • Partner
  • British Virgin Islands
Claire Goldstein
Claire Goldstein
  • Claire Goldstein

  • Partner
  • British Virgin Islands
Hazel-Ann Hannaway
Hazel-Ann Hannaway
  • Hazel-Ann Hannaway

  • Partner
  • British Virgin Islands
Nick Hoffman
Nick Hoffman
  • Nick Hoffman

  • Partner
  • Cayman Islands
Andrew Johnstone
Andrew Johnstone
  • Andrew Johnstone

  • Partner
  • Hong Kong
Paula Kay
Paula Kay
  • Paula Kay

  • Partner
  • Hong Kong
Phillip Kite
Phillip Kite
  • Phillip Kite

  • Partner
  • British Virgin Islands
Vicky Lord
Vicky Lord
  • Vicky Lord

  • Partner
  • Shanghai
Paul Madden
Paul Madden
  • Paul Madden

  • Partner
  • Cayman Islands
Henry Mander
Henry Mander
  • Henry Mander

  • Partner
  • Cayman Islands
Ian Mann
Ian Mann
  • Ian Mann

  • Partner
  • Hong Kong
William Peake
William Peake
  • William Peake

  • Partner
  • London
Lorinda Peasland
Lorinda Peasland
  • Lorinda Peasland

  • Consultant
  • Hong Kong
Chai Ridgers
Chai Ridgers
  • Chai Ridgers

  • Partner
  • Hong Kong
Nicola Roberts
Nicola Roberts
  • Nicola Roberts

  • Partner
  • Hong Kong
  • Singapore
Paul Smith
Paul Smith
  • Paul Smith

  • Partner
  • Cayman Islands
Andrew Thorp
Andrew Thorp
  • Andrew Thorp

  • Partner
  • British Virgin Islands
Jessica Williams
Jessica Williams
  • Jessica Williams

  • Partner
  • Cayman Islands
Jayson Wood
Jayson Wood
  • Jayson Wood

  • Partner
  • Cayman Islands

10 Minutes with Rose Kehoe: Chinese Company Take-Private Transactions

Market conditions have sparked a series of take-private transactions by Chinese companies. 

In some instances, minority shareholders consider that they have missed an opportunity to share in the possible upside and will seek resolution through court processes. In the case of Cayman companies’ mergers, it will be a matter for the Court to resolve claims by dissenting minority shareholders, under s.238 of the Cayman Companies Law, by determining ‘fair value’. This is an exercise in striking a balance, a process where quantitative estimates derived from alternate valuation methodologies are calibrated to appraise value.  The Integra Group ruling (Integra) provided initial practical guidance in determining fair value while making clear that there is no ‘one size fits all’ approach, and that each case is dependent on individual circumstances.

Integra guidelines suggest an approach combining discounted cash flow (DCF) and market based methodologies, placing a greater weighting in this case on the ‘intrinsic’ value of the company as implied by DCF, due to case specific factors. The underlying drivers of DCF are forward looking estimates that are not wholly observable in the market and there is necessarily a degree of subjectivity in estimation under this methodology.  For this reason, it is important to also reference market prices in determination of fair value as these are quantitative points that are observable in the market. Chinese company take-private transactions are undertaken with reference not only to US but also China markets. 

Value is assessed on the basis of future expectations, and so it is rational to consider all markets, including China, when preparing an analysis of valuation multiples. For any more information, please contact Rose Kehoe of Zolfo Cooper (Hong Kong).

Leave A Comment