BVI Liquidators Appointed To One Of The World's Largest Seafood Companies

BVI winding up proceedings - Pacific Andes

The BVI Commercial Court (the Honourable Justice Davis-White QC [Ag]) has recently ordered the appointment of liquidators over Pacific Andes Enterprises (BVI) Limited, Parkmond Group Limited, and PARD Trade Limited (the "Companies"), three BVI incorporated companies forming a key part of the China Fishery Group. The applications were unsuccessfully contested on the principal ground that the appointment of liquidators would irretrievably damage the prospects of a wider, global restructuring of the Pacific Andes Group.

The BVI Court rejected that argument, and in his judgment dated 1 December 2016 Davis-White J provided a helpful analysis of the factors that a Court should take into account in determining whether to wind up a company at a contested hearing in these circumstances, and confirmed the primacy of the views of independent creditors.

Background

The China Fishery Group and certain other companies make up the Pacific Andes Group (the "Group"), whose activities include harvesting, sourcing, ocean logistics and transportation, food safety testing, processing, marketing and distribution of frozen fish products across a broad range of markets. The Group's holdings are substantial and include publicly listed companies on the main boards of the Singapore and Hong Kong Stock Exchanges. As has been widely reported, the Group has been under sustained financial pressure for some time, with a number of Group companies seeking Chapter 11 and Chapter 15 bankruptcy protection in the United States, and other insolvency proceedings occurring in numerous other jurisdictions including the Cayman Islands, Hong Kong, Peru and Singapore.

The winding up petitions

The applicant, Bank of America ("BANA"), sought the liquidation of the Companies on the principal ground that they were insolvent, having failed to discharge a debt of approximately US$15 million which had been outstanding to BANA since November 2015.

On the application of two other creditors of the Companies, Cooperative Rabobank U.A. Hong Kong Branch ("Rabobank") and Standard Chartered Bank (Hong Kong) Limited ("SCB"), joint provisional liquidators had already been appointed to the Companies in October 2016.

BANA's applications were supported by a number of other bank and trade creditors of the Companies including Rabobank and SCB. The Companies opposed the applications, seeking (in the first instance) an adjournment beyond the expiry of the...