KIRI INDUSTRIES LIMITED v SENDA INTERNATIONAL CAPITAL LIMITED & Anor

Q: Which legislation does [2024] SGHC(I) 14 consider?

The judgment refers to Civil Law Act (Cap 43), Companies Act (Cap 50), Insolvency, Restructuring and Dissolution Act, and Restructuring and Dissolution Act, among other provisions. The statutes cited are listed in full on this page, each linking to its primary text.

[2024] SGHC(I) 14 Singapore International Commercial Court 20 May 2024 • SIC/S 4/2017 ( SIC/SUM 24/2023 ) • 45 min read

14 cases cited (8 SG, 6 foreign) Cited by 3 cases

Catchwords

Companies — Oppression — Minority shareholders

Practice Areas

Companies

Judges (3)

Anselmo Reyes Coram Kannan Ramesh Delivered Roger Giles Coram

Counsel (21)

Parties (3)

DyStar Global Holdings (Singapore) Pte Ltd Defendant Kiri Industries Limited Plaintiff Senda International Capital Limited Defendant

Case Significance

Kiri Industries Ltd v Senda International Capital Ltd and another [2024] SGHC(I) 14 was decided by the Singapore International Commercial Court on 20 May 2024, in Suit No 4 of 2017 (Summons No 24 of 2023). The grounds of decision were delivered by Kannan Ramesh JAD, sitting with Roger Giles IJ and Anselmo Reyes IJ, after hearings on 24 and 25 January and 23 February 2024. The matter concerned company oppression of minority shareholders. The central question in the application, SIC/SUM 24/2023, concerned the order the court should make in light of the purported inability of Senda International Capital Ltd ("Senda") to comply with an order to buy out (the "Buy-Out Order") the 37.57% shareholding held by Kiri Industries Ltd ("Kiri") in DyStar Global Holdings (Singapore) Pte Ltd ("DyStar") at the price of US$603.8m. In the Main Judgment, DyStar Global Holdings (Singapore) Pte Ltd v Kiri Industries Ltd and others and another suit [2018] 5 SLR 1, delivered on 3 July 2018, the court held that Senda, the majority shareholder in DyStar, had engaged in oppressive conduct against Kiri and ordered the buy-out; the findings of oppression were upheld on appeal in [2019] 2 SLR 1. The valuation tranche concluded on 3 March 2023. Kiri was represented by Allen & Gledhill LLP, and the defendants by Drew & Napier LLC and Rajah & Tann Singapore LLP.

[2024] SGHC(I) 14 explained

KIRI INDUSTRIES LIMITED v SENDA INTERNATIONAL CAPITAL LIMITED & Anor ([2024] SGHC(I) 14) is a Singapore judgment decided by the Singapore International Commercial Court on 20 May 2024. It is categorised under Companies. Within this corpus it has since been cited by 3 other reported Singapore judgments, a measure of how often later decisions have referred to it. This page summarises what the reported decision covers and links the primary sources — the full judgment, the statutes it cites, and the other cases it engages with — so the decision can be read in context. It is reference information, not legal advice, and it does not state the outcome or any holding beyond what the official judgment records.

What is [2024] SGHC(I) 14 about?

KIRI INDUSTRIES LIMITED v SENDA INTERNATIONAL CAPITAL LIMITED & Anor ([2024] SGHC(I) 14) is a Singapore International Commercial Court decision from 2024. Its published catchwords are “Companies — Oppression — Minority shareholders”, which indicate the subject matter the judgment addresses. The full reasoning and orders are in the judgment itself, linked below.

Which legislation does [2024] SGHC(I) 14 consider?

The judgment refers to Civil Law Act (Cap 43), Companies Act (Cap 50), Insolvency, Restructuring and Dissolution Act, and Restructuring and Dissolution Act, among other provisions. The statutes cited are listed in full on this page, each linking to its primary text.

How influential is [2024] SGHC(I) 14?

Within this corpus, [2024] SGHC(I) 14 has been cited by 3 later reported Singapore judgments. That count reflects references from other decisions held in this corpus only and is a conservative lower bound on how often the case has actually been cited.

Summary

SUPREME COURT OF SINGAPORE

20 May 2024

Case summary

Kiri Industries Ltd v Senda International Capital Ltd and another [2024] SGHC(I) 14

Singapore International Commercial Court Suit No 4 of 2017 (Summons No 24 of 2023)

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Decision of the Singapore International Commercial Court (delivered by Kannan Ramesh JAD):

Outcome: The Singapore International Commercial Court (“SICC”) ordered an en bloc sale of the shares of DyStar Global Holdings (Singapore) Pte Ltd (“DyStar”) in substitution of an earlier buy-out order made in favour of Kiri Industries Ltd as against Senda International Capital Ltd.

Pertinent and significant points of the judgment

• The court had the inherent jurisdiction to make a substitute order where an earlier order had become ineffective: at [13] to [14].

• The court’s remedial powers under s 216(2) of the Companies Act 1967 (2020 Rev Ed) (the “Companies Act”) included the power to order an en bloc sale of the company’s shareholding: at [28] to [34].

• The court did not have the power to award pre-judgment interest or post-judgment interest in respect of a buy-out order. However, the court did have the discretion under s 216(2) of the Companies Act to account for interest by making adjustments to the purchase price of the shares: at [75] and [79].

Background

1 On 3 July 2018, the SICC held in DyStar Global Holdings (Singapore) Pte Ltd v Kiri Industries Ltd and others and another suit [2018] 5 SLR 1 that DyStar’s majority shareholder, Senda International Capital Ltd (“Senda”), had engaged in oppressive conduct against Kiri Industries Ltd (“Kiri”), the minority shareholder in the company. Senda was ordered to buy out Kiri’s shareholding at a valuation which was subsequently assessed to be US$603.8m (the “Buy-Out Order”) (Kiri Industries Ltd v Senda International Capital Ltd and another [2023] SGHC(I) 4). Senda did not comply with the Buy-Out Order as it claimed that it was not able to raise the funds necessary to perform the Buy-Out Order, namely the purchase price of US$603.8m for Kiri’s shares. Kiri did not accept Senda’s reasons and contended that Senda was simply unwilling to comply.

2 Kiri brought the present application for substitute relief. Senda and DyStar argued that the entire shareholding in DyStar should be sold en bloc. Kiri initially argued for a staged buy-out process involving a partial share buy-back by DyStar, with the remainder to be purchased either by a further buy-back by DyStar or a buy-out by Senda. However, Kiri later clarified that it did not object to an en bloc sale. The only dispute was over the terms of the en bloc sale, the division of the proceeds of sale and whether interest should accrue on the buy-out price.

The SICC’s Decision

3 The court held that the Buy-Out Order had become ineffective, and this was sufficient to justify the court’s exercise of its inherent jurisdiction to order substitute relief: at [18].

4 The court had a wide discretion to grant remedies under s 216(2) of the Companies Act 1967 (2020 Rev Ed) (“Companies Act”), so long as it was done with a view to bringing to an end or remedying the oppression. This included the power to order an en bloc sale of shares. In the present case, an en bloc sale was the best option for all parties: at [23] to [34] and [38].

5 It was appropriate for a receiver to be appointed by the court to have conduct of the en bloc sale. Such an appointee would owe duties and responsibilities to the court and would fully understand and appreciate his or her role. After considering the parties’ nominations, the court appointed Mr Matthew Stuart Becker, Mr Lim Loo Khoon and Mr Tan Wei Cheong of Deloitte and Touche LLP (the “Receivers”) as joint and several receivers: at [44] and [50].

6 The en bloc sale was to be conducted without a reserve price. Further, Kiri was to be paid US$603.8m from the proceeds of sale in priority to Senda (after deducting the Receivers’ remuneration and the expenses of the sale). The court further ordered that the long-stop date for the en bloc sale would be 31 December 2025. In ordering the sale, the court was facilitating the achievement of the substantive result in its original decision, including Kiri’s entitlement to exit DyStar at the assessed price: at [57], [61] and [63].

7 The court rejected Kiri’s submission that it should be entitled to payment in advance of the completion of the en bloc sale. This would likely have complicated the sale process, and Kiri had not shown that it was suffering hardship or prejudice such as to justify an advance payment: at [64] to [66].

8 Lastly, the court held that while it did not have the power to award post-judgment interest on the purchase price of the shares in a buy-out order, it had the discretion under s 216(2) of the Companies Act to account for interest through an adjustment to the purchase price. However, the court was not inclined to do so in light of all the circumstances in the present case: at [79] to [83].

This summary is provided to assist in the understanding of the Court’s grounds of decision. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s grounds of decision.

What was Kiri Industries Ltd v Senda International Capital Ltd [2024] SGHC(I) 14 about?

It was a Singapore International Commercial Court decision dated 20 May 2024 addressing the order to be made given Senda's purported inability to comply with an order to buy out Kiri's 37.57% shareholding in DyStar Global Holdings at US$603.8m, arising from findings of minority oppression.

What was the Buy-Out Order in Kiri Industries v Senda [2024] SGHC(I) 14?

The Buy-Out Order required Senda International Capital Ltd to buy out the 37.57% shareholding held by Kiri Industries Ltd in DyStar Global Holdings (Singapore) Pte Ltd at US$603.8m. It followed the Main Judgment of 3 July 2018, which found Senda had engaged in oppressive conduct against Kiri.