The High Court has sanctioned a scheme of arrangement for CGI Group Holdings Europe Ltd to acquire SCISYS Group plc and confirmed a related reduction of the company’s issued share capital.
In an ex tempore judgment delivered on 17 December 2019, Mr Justice David Barniville said the legal requirements for approving the scheme had been met. He found that interested parties had been notified, statutory and court requirements complied with, shareholders properly treated as one class, and no improper coercion had been alleged or appeared to arise.
At the scheme meeting on 7 August 2019, 144 of the 151 shareholders who voted supported the proposal, with seven voting against. The judgment records that 97.4% of those voting supported it. The judge said the scheme was fair, reasonable and equitable, while noting the court was not a rubber stamp.
The sanction hearing had been adjourned after the required regulatory clearances were obtained but steps for the proposed delisting of SCISYS shares from AIM and Euronext Growth remained outstanding. The court made no order at the hearing on 30 October, allowing time for those steps. The judge later deferred his ruling beyond 14 November because the company’s UK media and broadcasting business was facing the UK general election, which took place on 12 December.
The capital reduction was to cancel certain shares, then restore the issued share capital to its former amount through an equivalent allotment of new shares to CGI. The judge accepted evidence that this arrangement would not affect creditors. He found the reduction had a discernible purpose, shareholders had been treated equitably, and the scheme circular explained the proposal.
The court confirmed the reduction and ruled that it was not necessary to settle a list of creditors under section 85(4) of the Companies Act 2014. The judge also said he would make further orders set out in the company’s draft order and give liberty to apply.