Members Scheme of Arrangement in Singapore: How a Privatisation Works

Short answer: A members scheme of arrangement in Singapore is a court-supervised way to take a company private under section 210 of the Companies Act 1967. A majority in number holding at least 75% in value of those voting must approve, and the court must sanction it. It then binds every shareholder once lodged with ACRA.

Raffles Corporate Services works with a panel of experienced Singapore law firms who offer cost-effective and efficient legal service and advice. This article is general information only and is not legal advice.

What is a members scheme of arrangement for a privatisation?

It is an agreement between a company and its shareholders, approved by a shareholder vote and sanctioned by the High Court, under which a buyer ends up owning all the shares. In a typical privatisation the bidder signs an implementation agreement with the target. The target’s shares are then either cancelled and new shares issued to the bidder, or transferred to the bidder, in exchange for the offer price (Baker McKenzie, Global Public M&A Guide, Singapore).

The attraction is certainty. Once the scheme is sanctioned and the order is lodged, every shareholder is bound, including those who voted against. A general offer, by contrast, depends on the bidder reaching the compulsory acquisition threshold. Our existing guides explain the general scheme of arrangement procedure and the majorities needed to approve a scheme. This article focuses on how the mechanism is used to take a company private.

What is the legal basis for a members scheme of arrangement in Singapore?

The power comes from section 210 of the Companies Act 1967 (2020 Revised Edition). Section 210(1) allows the court, on the summary application of the company, a creditor or a member, to order a meeting of members or a class of members to be summoned in the manner the court directs.

The key provisions, as cited by the Court of Appeal and the High Court, are these:

The three-stage process was set out by the Court of Appeal in The Royal Bank of Scotland NV v TT International Ltd [2012] 2 SLR 213 and restated in UT Singapore Services Pte Ltd v Goh Thien Phong [2025] SGCA 17 (unreported). Those cases involved creditor schemes, but the section applies in the same way to a scheme between a company and its members. Subsection numbering follows the way the courts cited the section in 2025 and 2026, so your solicitor should check it against the current text on Singapore Statutes Online.

Who can apply, and when does a privatisation scheme make sense?

For a privatisation, the target company is normally the applicant, acting on its board’s decision and under the implementation agreement with the bidder. A scheme suits a bidder who wants all the shares and cannot risk falling short of a high acceptance level.

The alternatives differ mainly in the threshold:

Sources: Baker McKenzie’s Singapore guide (last updated 1 January 2025) and Rajah & Tann’s note on the 6 May 2026 Companies Act changes. For the squeeze-out route, see our guide to section 215 compulsory acquisition.

What are the steps in a members scheme of arrangement?

There are three court-linked stages, with the commercial agreement and Code compliance running alongside them.

1. Agree the deal. The bidder and target sign an implementation agreement. For a listed company, the parties consult the Securities Industry Council (SIC), because the Code applies to schemes. Bidders commonly obtain exemptions from provisions such as the takeover timetable and the type of consideration required (Baker McKenzie).
2. Apply to convene the meeting. The company applies to the General Division of the High Court by originating application under section 210(1). The court gives directions on the class or classes of members and on how the meeting is to be summoned.
3. Send the notice and explanatory statement. Notice of the meeting goes to members with the section 211 explanatory statement, which must explain the effect of the scheme fairly and fully.
4. Hold the scheme meeting. Members vote in person or by proxy. In each class, the scheme passes only if a majority in number of members present and voting, holding at least 75% in value of the shares voted, agree.
5. Apply for sanction. If the meeting approves, the company returns to court. The court must be satisfied that the statutory provisions were complied with, that those at the meeting fairly represented the class and the majority did not coerce the minority, and that an intelligent and honest member, acting in his own interest, would reasonably approve the scheme (TT International at [70]).
6. Lodge the order. The sanction order is lodged with ACRA. Under section 210(5), the scheme then binds all members.
7. Implement. Shares are cancelled or transferred, the consideration is paid and, for a listed company, delisting follows.

What documents does a members scheme need?

The core papers are the application, the supporting evidence, the scheme document and the explanatory statement. Exact contents are settled by the solicitors and the court’s directions.

How long does a privatisation scheme take, and what does it cost?

There is no fixed statutory timetable. The pace is driven by the court’s directions, regulatory clearances and, for a listed company, the Code. Costs are quoted per matter and depend on the size of the target, the number of classes, regulatory approvals and whether any shareholder contests the scheme, so we do not publish a range that could mislead.

The Monetary Authority of Singapore announced these revisions on 16 June 2026 on the advice of the SIC. They also cap the total break fees payable by the offeree company at 1% of its value and require the offeree board and its financial adviser to explain to the SIC why a break fee is in shareholders’ interests (MAS media release, 16 June 2026).

What does the company secretary prepare, and what does the solicitor file?

Court proceedings are conducted by a Singapore Advocate and Solicitor. We work with a panel of firms, and you can see how a litigation and corporate law practice typically handles this work. The company secretary supports the process but does not give legal advice.

Good board paperwork matters. See our guide to board resolutions in Singapore.

What happens after the court sanctions the scheme?

The scheme binds every member only once the order is lodged with ACRA, so lodgement is a gating step. Our guide on how to lodge a court order with ACRA explains who files and by when.

After effectiveness, the company secretary updates the register of members to reflect the cancellation or transfer, files the resulting changes through Bizfile, and records the new sole shareholder. Where the target is listed, delisting typically follows under the Listing Manual. A sanctioned scheme can still be shaped by the court. Under section 210(4) the court may approve a scheme subject to alterations or conditions, but in Re Ficus Asia Investment Pte Ltd [2026] SGHC 150 (unreported; grounds subject to final editorial corrections) the High Court declined to alter a scheme at the request of a creditor who had voted in favour, observing that such a party should not expect the court to carry out the negotiation it should have conducted itself. See also our note on when a court can alter a scheme.

What are the common mistakes in a privatisation scheme?

• Treating the 75% test as a test of all shares. It is measured on members present and voting, with a separate majority in number.
• Putting members with different rights in one class. Classification is decided at the convening stage, and disputes raised late can cause delay.
• Weak explanatory statements that omit material interests or the effect of the scheme.
• Ignoring the Code timetable. Under the revised Code the meeting must be held within 6 months of the announcement.
• Agreeing break fees or exclusivity that breach the revised Rule 13 limits.
• Forgetting that the scheme is not binding until the order is lodged with ACRA.

Frequently asked questions

What majority is needed to approve a members scheme in Singapore?

A majority in number of the members or class present and voting, who together hold at least 75% in value of the shares voted. The court’s sanction is then required.

Does a privatisation scheme bind shareholders who vote against it?

Yes. Once the scheme is approved, sanctioned by the court and the order is lodged with ACRA, it binds all members, including dissenters.

Is a scheme better than a takeover offer?

It depends. A scheme gives certainty of 100% ownership if the vote and sanction succeed, but needs a court process and a 75% in value vote. A general offer avoids court but may not reach the 90% compulsory acquisition level.

Can a private company use a members scheme?

Yes, section 210 is not limited to listed companies. Private companies use schemes for restructurings and buy-outs, though the Code’s rules apply only to the companies it covers.

Can the court change the terms of a scheme?

Section 210(4) lets the court approve a scheme subject to alterations or conditions it thinks just, but courts approach this cautiously and expect proposed alterations to be specific and supported.

Useful tools: Raffles Corporate Services free tools. Official sources: MAS, eLitigation and Singapore Statutes Online.

Last reviewed: 10 November 2026. The Editorial Team, Raffles Corporate Services.