165 Shareholders’ recovery of money on an unsuccessful allotment

Where a company is placed into administration, receivership or even liquidation, there is no general principle that subscribers to an allotment are entitled to their money back if the company or even the particular allotment is not as successful as was hoped. The money subscribed for the shares will generally become the property of the company and, in the case of a receivership or liquidation, be applied by the insolvency practitioner to pay the company’s creditors, in which case the shareholders can only wait in line.

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