Rejecting a buyout offer in a quasi-partnership company not necessarily fatal to securing a just and equitable winding up
Case briefing: Asia Pacific v ARC Capital LLC
- Investment Co T belonged equally to Messrs C and K.
- It was common ground that T was a “quasi-partnership”
- C sought a winding up on the just and equitable ground
- K offered to buy C’s interest in T at a so called fair value and claimed C’s application to wind up was therefore an abuse of process.
A petitioner for a winding up who rejects a buyout offer at fair value should normally expect to have his petition dismissed. In quasi-partnership cases it is not necessarily unreasonable to reject a buyout offer solution.
If a joint venture company is effectively a quasi-partnership things become less objective. A 50% shareholder is allowed to take the view that a fair solution to a breakdown would be;
- For him to buy out the other party
- For both parties to sell to a third party
- For the company to be wound up.
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