| Commentary

195 Scheme for reduction of share capital

| Commentary

195 Scheme for reduction of share capital

The court’s jurisdiction to sanction a reduction of capital is not confined to the specific methods detailed in the Companies Act 20061. Case law has long established the court’s jurisdiction in this area extends to every mode of reduction which is not inequitable2, including its satisfaction in specie by the transfer of assets3. It is no objection to such a scheme that it involves an alteration of rights of voting and priority as between different classes of shareholders4.

Where the reduction of capital differentiates between

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