The Minority Shareholder's Statutory Exits

Pey Woan Lee, Singapore Management University


A troubled minority shareholder of a private company who desires to liquidate his investments in the company commonly resorts to one of two statutory exits. He may ask to be bought out or seek to wind up the company under section 216 of the Companies Act on establishing oppressive conduct by the dominant shareholders, or he may seek an order to wind up the company under section 254(1)(i) of the Companies Act on the ground that it is just and equitable to do so. The Court of Appeal's recent decision in Evenstar provided timely clarification on the relationship between these two jurisdictions. The court affirmed the notion of unfairness as the essence of both. The Court of Appeal's lucid and thorough analysis has undoubtedly clarified the conceptual basis on which relief might be granted under sections 216 and 254(1)(i).