Privy Council ruling fuels Barbados fight over Cable & Wireless deal

Fortified by a major legal win in Jamaica, over 300 minority shareholders in Cable & Wireless Barbados (C&W) have renewed their fight in the local High Court, asking for a ruling on a controversial 2017 corporate merger.

The group, led by Kenneth Ricky Went, Omstand Investment Inc., and Phillip Osbourne, filed fresh submissions last week, arguing their rights were sidelined during the amalgamation of C&W Barbados and C&W West Indies Limited.

Their case may hinge on a recent decision by the UK-based Privy Council, which dismissed an appeal by Cable & Wireless Jamaica (CWJ) and ruled in favour of minority shareholder Eric Jason Abrahams.

At the heart of both cases is a question of fairness: should minority shareholders be treated as a separate class when their shares are being cancelled or bought out, while majority shareholders retain theirs? The Privy Council said yes, and the Barbados claimants say that the ruling strengthens their own argument.

Senior Counsel Garth Patterson, representing the claimants, argued that the Privy Council’s reasoning in the Jamaica case is in keeping with the Barbados minority shareholders’ position that they should have been treated as a separate class and allowed to vote independently on the 2017 merger.

The claimants maintain that the scheme’s approval process failed to meet the legal threshold required under Barbados law. By treating minority and majority shareholders as a single voting class, despite their fundamentally different treatment under the transaction, they argue that the statutory majorities were never properly achieved.

With the Privy Council’s ruling now reinforcing their position, the minority shareholders group is asking the Barbados High Court to declare the 2017 merger invalid or to recognise the process as oppressive and grant substantive relief.

The Privy Council’s ruling emphasised that voting classes in such schemes must be based on legal rights and how those rights are affected, not on shared interests or motives.

Since the Barbados minority shareholders were being bought out while the majority retained their stake, the claimants argue they were clearly in a different class and should have voted independently.

The failure to hold separate class meetings meant the required approval wasn’t valid, the submission states, and the scheme should never have been sanctioned.

Among the nine defendants named in the Barbados case is Professor Sir Hilary Beckles, Vice Chancellor of the University of the West Indies.

Went, speaking on behalf of the claimants, said the group is optimistic about the local court’s pending judgment, telling Barbados TODAY that the Privy Council’s decision gives them confidence.

emmanueljoseph@barbadostoday.bb