Malaysia Court of Appeal interprets section 223 of Companies Act 2016 relating to requirement for shareholder approval for substantial transactions

27 June 2023

Concrete Parade Sdn Bhd v Apex Equity Holdings Bhd & Ors [2021] 9 CLJ 849

This article by our associate firm in Malaysia, Rahmat Lim & Partners, provides an overview of the Court of Appeal of Malaysia’s decision in Concrete Parade Sdn Bhd v Apex Equity Holdings Bhd & Ors.

The appellant, Concrete Parade Sdn Bhd, was a shareholder of the respondent, Apex Equity Holdings Berhad. The appellant brought a minority oppression action under section 346 of the Companies Act 2016 (“CA 2016”) to:

• nullify all agreements pertaining to a proposed merger on the ground that they breached sections 85 and 223 of the CA 2016 by denying the appellant of its statutory pre-emptive right to be offered the new shares in the respondent and for not obtaining prior shareholders’ approval for the merger exercise; and
• set aside the court order validating the 2005 to 2017 share buy-back transactions on the ground that the court could not validate a breach of section 67(1) of the Companies Act 1965 and/or section 123 of the CA 2016.

To read the full article on the Rahmat Lim & Partners’ website, please click here.