Amerisur Resources Plc, Re Companies Act 2006

The court considered an application to sanction a members' scheme of arrangement under the Companies Act 2006 (s.425). The statutory requirements for sanction were satisfied: the scheme meeting produced the requisite value majority and there were no relevant ancillary agreements. Objectors sought a condition of sanction requiring the company to undertake to maintain unencumbered UK assets up to £6.9 million to protect potential claimants under separate proceedings who had obtained a freezing order in the Queen's Bench Division. The judge held that the scheme itself did not affect creditors' interests and that potential future asset relocations were not sufficiently connected to, or dependent on, the scheme to justify imposing the condition. The court followed the principles in BAT Industries and Re Baltic Exchange Ltd concerning when third‑party concerns and ancillary arrangements may be taken into account but distinguished those authorities on the facts. The sanction was granted and the requested undertaking was refused.

This was a first‑instance sanction hearing before Mr Justice Zacaroli for a straightforward members' scheme to transfer the shares of Amerisur Resources plc to a purchaser group vehicle (“Bidco”). The scheme required sanction under the Companies Act 2006. The turnout at the scheme meeting was low by numbers but exceeded 60 per cent by value and was accepted as sufficiently representative.

The principal contested issue arose from separate litigation in the Queen's Bench Division in which a group of claimants had commenced proceedings against the company and obtained an interim freezing order for £3,178,600 in respect of 15 named claimants and a further group of those to be added by amendment. The claimants argued that if all potential claimants were added a freezing order would need to be £6.9 million. They therefore sought, as a condition of scheme sanction, an undertaking from the company to maintain unencumbered UK assets at least up to that sum to protect creditors and potential judgment creditors from an alleged risk that assets would be relocated or otherwise dissipated following the acquisition.

The court framed the issues as (i) whether the court could take such broader creditor concerns into account when sanctioning a members' scheme and (ii) whether, on the facts and documentary material (including a letter from the company chairman), the risk was sufficiently connected to the scheme to justify imposing the requested condition. The judge acknowledged authority that third‑party concerns and ancillary arrangements may be considered (notably BAT Industries and Re Baltic Exchange Ltd), and accepted that the claimants had standing to be heard. He analysed the chairman's letter and concluded that references to accounting consolidation, a review of the business, AIM delisting, and potential relocation of the principal office did not amount to evidence of an impending transfer of assets or an ancillary arrangement dependent on the scheme. Importantly, the court found the scheme merely effected a transfer of share ownership and did not itself deprive creditors of assets; any future transfers could be effected without the scheme and would be governed by the protections of company law. The court therefore refused to impose the undertaking sought and made the order sanctioning the scheme.

The judge also noted that imposing the condition sought by the objectors would have enabled them to bypass the limits applied by the Queen's Bench Division in freezing order proceedings and would have avoided the cross‑undertaking in damages that would attend a freezing order application seeking a larger sum. The judge therefore dismissed the objection and sanctioned the scheme.

The court sanctioned the scheme of arrangement. The court refused the claimants' request to make sanction conditional on the company undertaking to maintain unencumbered UK assets up to £6.9 million because the scheme itself did not affect creditors' interests, there were no ancillary arrangements creating the risk asserted, and potential future asset relocations were insufficiently connected to the terms or implementation of the scheme to justify the condition.