Capital reduction: Why do some companies still go to court?
Under the Companies Act 2016 of Malaysia, a company which intends to carry out reduction of share capital may do so by any of the following methods unless provided otherwise in its constitution: a special resolution and confirmation by the Court (“Court Confirmation Procedure”) in accordance with section 116; or …
Disposal of business: What to take note
Business owners or sellers who are disposing their business, whether by way of disposal of business assets or disposal of shares of companies which own the business assets, should take note of the issues set out below. The disposal of business assets and/or disposal of shares of companies which own …
Seller beware: Discharge of guarantee after disposal of shares
In a share sale and purchase transaction, the transfer of shares to the buyer and payment of consideration to the seller may not necessarily signify the end of the parties’ obligations. After completion of the sale and purchase of shares, it is important to the seller to have all guarantee …
Selling or buying a business-Use a term sheet
When selling or buying a business, whether via a sale and purchase of shares or via a sale and purchase of assets, the seller and the purchaser should consider using a term sheet to set out the principal terms and conditions of the transaction. Having a term sheet enables the …
No mandatory requirement for a notice of directors meeting to contain specific particulars of matters to be discussed upon
It was held in the High Court case of Rozilawati bt Hj Basir v Nationwide Express Holdings Bhd & Ors [2019] 8 MLJ 8 (“Rozilawati’s case”) that as a matter of company law or the law of meetings, there is no mandatory requirement for a notice of directors meeting to …
Directors to take note: Changes under the Companies Act 2016
The Companies Act 2016 (“CA 2016”) of Malaysia repealed the Companies Act 1965 (“CA 1965”) with effect from 31 January 2017. The CA 2016 introduces some important changes relating to directors. This article highlights ten changes under the CA 2016, which directors should take note of. 1. Definition of Directors …
Common issues in mergers and acquisitions
A merger and acquisition (“M&A”) transaction involves at least two parties, the seller and the purchaser, coming together to negotiate on the terms and conditions of the sale and purchase of the target company or asset (“Target”). The agreed terms and conditions are then set out in a sale and …
Securities Commission Malaysia revised prospectus guidelines
The Prospectus Guidelines (“Guidelines”) are issued by the Securities Commission Malaysia (“SC”) under section 377 of the Capital Markets and Services Act 2007 to set out the additional disclosure requirements in respect of a prospectus and the information to be disclosed in an abridged prospectus. The SC revised the Guidelines …