Companies Act, 1990

Pooling of assets of related companies.

141.—(1) Where two or more related companies are being wound up and the court, on the application of the liquidator of any of the companies, is satisfied that it is just and equitable to make an order under this section, the court may order that, subject to such terms and conditions as the court may impose and to the extent that the court orders, the companies shall be wound up together as if they were one company, and, subject to the provisions of this section, the order shall have effect and all the provisions of this Part and Part VI of the Principal Act shall apply accordingly.

(2) In deciding the terms and conditions of an order under this section the court shall have particular regard to the interests of those persons who are members of some, but not all, of the companies.

(3) Where the court makes an order under subsection (1)

(a) the court may remove any liquidator of any of the companies, and appoint any person to act as liquidator of any one or more of the companies;

(b) the court may give such directions as it thinks fit for the purpose of giving effect to the order;

(c) nothing in this section or the order shall affect the rights of any secured creditor of any of the companies;

(d) debts of a company that are to be paid in priority to all other debts of the company pursuant to section 285 of the Principal Act shall, to the extent that they are not paid out of the assets of that company, be subject to the claims of holders of debentures under any floating charge (as defined in that section) created by any of the other companies;

(e) unless the court otherwise orders, the claims of all unsecured creditors of the companies shall rank equally among themselves.

(4) In deciding whether it is just and equitable to make an order under subsection (1) the court shall have regard to the following matters—

(a) the extent to which any of the companies took part in the management of any of the other companies;

(b) the conduct of any of the companies towards the creditors of any of the other companies;

(c) the extent to which the circumstances that gave rise to the winding up of any of the companies are attributable to the actions or omissions of any of the other companies;

(d) the extent to which the businesses of the companies have been intermingled.

(5) Notwithstanding any other provision, it shall not be just and equitable to make an order under subsection (1) if the only ground for making the order is—

(a) the fact that a company is related to another company, or

(b) that creditors of a company being wound up have relied on the fact that another company is or has been related to the first mentioned company.

(6) Notice of an application to the court for the purposes of this section shall be served on every company specified in the application, and on such other persons as the court may direct, not later than the end of the eighth day before the day the application is heard.