Recent amendments to the Cayman Islands Companies Law have
fine tuned the mechanics for implementing mergers involving
Cayman Islands companies. These improved provisions have been
welcomed especially by lawyers advising on takeovers of Cayman
Islands companies listed on various exchanges around the world,
where, previously, the more involved scheme of arrangement
procedure was the procedure of choice for implementing these
types of acquisitions.
Recent examples of listed Cayman Islands companies that have
announced they are proposing to go private by statutory merger
include Chemspec International, Funtalk China Holdings and
CNinsure (all Nasdaq-listed).
What is a merger? A merger is a procedure whereby one or
more constituent companies are subsumed into another
constituent company, the latter of which becomes the surviving
entity upon the merger taking effect. The legal effect of a
merger is that the surviving entity assumes all the rights,
obligations and liabilities of every non-surviving constituent
company, whilst at...