[2026] EWHC 1572 (Ch)Case No CR-2025-003555IN THE HIGH COURT OF JUSTICEBUSINESS AND PROPERTY COURTS OF ENGLAND WALES COMPANIES COURT (ChD)Venue The Rolls Building 7 Rolls Building, Fetter Lane London EC4A 1NLDate Monday, 27 April 2026
Before
MR JUSTICE HILDYARDIN THE MATTER OF: WISE PLCAND IN THE MATTER OF: THE COMPANIES ACT 2006MR ANDREW THORNTON KC (instructed by Cooley (UK) LLP) appeared on behalf of the CompanyAPPROVED JUDGMENTDigital Transcription by Epiq Europe Ltd, Lower Ground, 46 Chancery Lane, London WC2A 1JEWeb: www.epiqglobal.com/en-gb/Email: civil@epiqglobal.co.uk (Official Shorthand Writers to the Court)This Transcript is Crown Copyright. It may not be reproduced in whole or in part other than in accordance with relevant licence or with the express consent of the Authority. All rights are reserved.WARNING: reporting restrictions may apply to the contents transcribed in this document, particularly if the case concerned a sexual offence or involved a child. Reporting restrictions prohibit the publication of the applicable information to the public or any section of the public, in writing, in a broadcast or by means of the internet, including social media. Anyone who receives a copy of this transcript is responsible in law for making sure that applicable restrictions are not breached. A person who breaches a reporting restriction is liable to a fine and/or imprisonment.For guidance on whether reporting restrictions apply, and to what information, ask at the court office or take legal advice.
[1]Wise Plc, which I shall refer to either as "Wise" or "the Company", seeks the court's sanction of a proposed scheme of arrangement (“the Scheme”) pursuant to Part 26 of the Companies Act 2006.[2]The Scheme is proposed between the Company and the holders of its class A shares of £0.01 each and its class B shares of £0.000000001 each, which I shall call "the Scheme Shares" and "the Scheme Shareholders" respectively.[3]The purpose of the Scheme is to insert a new holding company in to the group so as to facilitate a primary listing on the Nasdaq in the United States, with a secondary listing on the main market operated by London Stock Exchange Plc, where it is presently exclusively listed.[4]The essence of the Scheme is that it provides for a transfer of all the Scheme Shares to Wise Group Plc, a Jersey public limited company, which I shall call "Wise Holdco", in consideration for the transfer of the Scheme Shares to Wise Holdco. Wise Holdco will issue Wise Holdco shares to the Scheme Shareholders, such that each Scheme Shareholder will receive one Wise Holdco class A share for each Scheme Share that is a Wise class A share held at the Scheme record time and one Wise Holdco class B share for each Scheme Share that is a Wise class B held at the Scheme record time. This is subject to downwards adjustment in respect of the holders of the two initial subscriber shares in Wise Holdco.[5]The Company carries on business as a global payment service provider. Although that is the description, it is nevertheless categorised, and regards itself, as in the technology sector. This is important for reasons which I shall come on to explain.[6]The wrinkles in the Scheme, if I can say to describe them, emanate from the fact of the dual share class structure and, in particular, the fact that class B shares have weighted voting rights, and those voting rights are held as to the majority by Mr Käärmann who, together with his interest in the class A shares, holds the substantial per cent of 50 per cent in overall terms and the other major shareholder being a company called Skaala Investments OÜ (which I shall call “Skaala”), which is the investment company of one of the co-founders of Wise Plc, and which, initially at any rate, objected to what is proposed.[7]This two-class share structure has become uncommon in England because of previous concerns to squeeze out special voting shares. However, curiously and to its advantage, American markets in the technology sector have rather embraced the idea in that the structure may enable the directing minds, the persons with what is called vision-based drive, to be given some considerable influence institutionally over the affairs of their company.[8]The class B shares hold nine votes per share, they are non-transferable and amongst other voting right cancellation events, each class B share will immediately cease to carry any entitlement to voting rights in July 2026, being the fifth anniversary of admission to trading on the LSE main market. The class B shares have no economic rights beyond a preferential return of their nominal value on a winding up or other return of capital, and are not admitted to trading on any exchange.[9]As part and parcel of what is proposed under the Scheme, the voting rights attached to the Class B shares are to be capped so that no shareholder can cast more than one vote less than 35% of the eligible votes in respect of a shareholder resolution. This is further varied in respect of Kristo Käärmann, the co-founder and Chief Executive Officer of the Company, who, for so long as he remains as CEO, will have the right to vote with Class B shares capped at one vote less than 50% of the eligible votes in respect of a shareholder resolution.[10]The Class B shares can cease to have voting rights in certain circumstances, and in that event, they are to be redeemed by the Company pursuant to its Articles of Association.[11]For completeness, I should mention that the Company has also issued (through JP Morgan Chase Bank, N.A. as depositary) American Depositary Receipts (“ADRs”) representing a beneficial interest in one Class A share. These are not listed but are traded “over-the-counter” in the USA.[12]Mr Thornton KC has presented the Scheme on behalf of the Company and if it is approved, will in due course have instructions to give the requisite undertaking to bind the new holding company. He has taken me carefully through the proposals as regards the Class B shares, suffice to say that the overall proposal, which as I say is part and parcel of the Scheme arrangements, is for what he described as the sunset period now to be extended by a further 10 years. That extension is to be achieved as an integral part of the resolutions which enable the approved Scheme.[13]I think I can broadly describe the opposition of Skaala which I have mentioned above as being centred, not on the proposal for the move to a main listing on Nasdaq, but on the linked proposal (and in that context the “bundling” of resolutions) for the extension of these Class B voting rights. Skaala's opposition is advanced notwithstanding that as I have explained, Skaala is the other main holder of the shares having those rights. I will come back later to the central question in this regard, which really is the matter of most interest and concern: by which I mean the issue as to the propriety both of there being a single resolution to achieve two purposes and the proposal for the extension of the sunset period.[14]First of all, I need to consider whether anything that I have said or any aspect of the Scheme causes any jurisdictional impediment to my proceeding further to consider whether the Scheme is fit for sanction. The jurisdictional requirements of Part 26 are well known.[15]First, the scheme must amount to compromise or arrangement proposed between the company and its members or any class. For that purpose, the court must be satisfied that there is something which involves the company in some activity, as it were, between itself and its member or some presumption of liability or other consideration. Some, in other words, give or take between the company and its members. In this case, I am satisfied that that requirement is fulfilled, noting in the context that the court has in a sense driven by convention adopted as a fairly exiguous test required of the company being sufficient that it should have the obligation to register a relevant transfer whereby to effectuate the scheme.[16]Secondly, a meeting or meetings must be convened by order of the court and properly constituted to ensure that the persons included in each meeting are such as who can be expected to have rights which are not so dissimilar as to make it impossible for them to consult together with a view to their common interest. That has been the test for class composition ever since Sovereign Life Assurance Company v Dodd [1892] 2 QB 573 as propounded by Lord Justice Bowen and although the application of the principles has gone through many iterations, it remains the test today.[17]Thirdly, the notice convening the court meeting must be accompanied by a compliant explanatory statement in accordance with section 897(1) of the Companies Act 2006 and that explanatory statement must explain the effect of the compromise or arrangement, state any material interest for the directors of the Company whether as directors or as members or as creditors, and the effect of those interests by the compromise or arrangement insofar as it is different from the effect on the like interests of other peoples.[18]Fourthly, once those class meetings properly constituted and sufficiently informed take place, the members or any class of member must approve the scheme by a majority in number representing 75 per cent in value of those shareholders who attend and vote at the meetings convened by the court.[19]Lastly, and the stage at which we are now at, if the jurisdiction requirements are fulfilled, the scheme must be sanctioned by the court if it is to take effect.[20]Dealing first with the issue of class composition, in this case, two classes of shares were identified as requiring separate class meetings of the Class A shares and Class B shares. The matter was referred to and in fact determined by ICC Judge Barber. The matter came before her on 2 July 2025 and was presented then, as now, by Mr Thornton KC. It was not considered at that time that there was any statutory complication as under the practice direction that required the matter to be referred in the first instance to a High Court judge.[21]I am satisfied that the two class meetings directed were appropriate in terms of jurisdiction. That is to say, I have not detected any fracturing elements such as to require more than those two meetings. I am also satisfied, for the avoidance of doubt, that it was proper and in my view correct to have two rather than one meeting.[22]I have interrogated Mr Thornton as to whether the interests in particular of Mr Käärmann, by virtue of his Class B voting rights, were such as to cause any jurisdictional issue. In times gone by and certainly by reference to Re Hellenic & General Trust Ltd [1976] 1 WLR 123, this might have been quite a vibrant point. But I think it is fair to say that since the 1970s, the tendency of the court has been to lean against jurisdictional tests in favour of a more open textured discretional approach, and I am content that there is no such obvious problem as would have resulted in the two classes not being able to discuss the proposals together especially given the overall aim of a change of listing venue over to the United States where the general financial view is that technology companies have a better prospect of a higher share price.[23]I note in that regard that on my questioning of Mr Thornton he was able to tell me on instructions that after the Scheme had, as it were, been publicised, the share price of Wise rose. It is I think to be supposed, as Mr Thornton was disposed to accept, that this was a response to the prospect of a move over to Nasdaq as the primary listing place.[24]I am also satisfied that when the classes voted, they did so on sufficient information. I am satisfied that the directors' interest were appropriately disclosed in the documentation which was sent to them and I am more generally satisfied that the explanatory statement did comply with the provisions of the statute. I am satisfied also that ICC Judge Barber having directed the two meetings and given directions as to how they were to be held were fulfilled and that the meetings after due notice, including a notice in ‘The Times’ newspaper on 4 July, were held on the basis of sufficient information.[25]One matter which did cause me some concern, and which I shall also return to later, is as to whether those voting were given sufficient notice of the objections which by then Skaala, through its solicitors, Taylor Wessing, had put forward.[26]My concern in this respect was that although it was plainly appropriate for shareholders to be notified of the concern and they were so, the timing was, as I described it to Mr Thornton in the course of his submissions, rather tight in that the notification was dated barely a week before the meeting and it was circulated to members by post, which might have taken a little time, as well as by RNS feed.[27]Nevertheless, Mr Thornton's counter to this worry, which was that no shareholders had complained that they had been taken by surprise or that they were not properly notified, signifies that there was no material concern on behalf of the shareholders and whilst I have had my own residual anxieties, I do not think in those circumstances I should take them as overawing the actual reaction of the persons of interest themselves.[28]I note that at the meeting, according to the Chair’s report, the resolutions to approve the Scheme received the requisite votes in favour both as to majority in number and majority in value of those shareholders who attended the court meetings. I will return to that too because whilst that is the jurisdictional position, that is not sufficient for the purpose of the exercise of my discretion where I ask for more detail as to the breakdown of the voting, as I shall later explain.[29]No questions were asked or statements made by Scheme Shareholders at the court meeting. That was to some extent surprising because Skaala sent a fairly substantial group, and were represented by five solicitors from Taylor Wessing who might have been expected to make additional points. But it is of note that they said nothing at all, according to the record. More generally, it is of note that since the initial flurries in July 2025, Skaala has not either carried forward their then threat to bring an unfair prejudice petition, nor has it sought to attend before me. I should have recorded that the matter was called out to ensure that Skaala were not waiting breathless to attend and there was no response and there has been no objection put forward by Skaala or for that matter by anyone else.[30]I should note the 14 Class A shareholders cast votes both for and against the Scheme in respect of different parts of their holdings and in that regard, the standard approach taken in Re Equitable Life Insurance treat the shares as both the member in favour and a member against the Scheme for the purpose of majority in number test was adopted.[31]The precise voting numbers were rehearsed in the chair's report. To some extent, they are not really the litmus test of this Scheme which they might be in other circumstances. In the appendix to this judgment, the numbers are set out.[32]To summarise, in terms of the votes actually cast and for the purposes of the jurisdiction requirements, the Scheme was approved by the relevant proportions in number and value.[33]In those circumstances, with the anxieties that I have expressed, I have nevertheless concluded that the jurisdictional requirements of the statute have been fulfilled. But that of course is only the gateway to the real purpose of today which is to consider whether in the court's discretion this is a fair scheme to sanction.[34]The approach to be taken by the court in determining whether or not, in its discretion, to sanction a proposed scheme is set out in a very well-known passage in the current edition of Buckley on the Companies Act at paragraph 219. Mr Thornton's very helpful skeleton argument has quoted and set that out at length, noting also that that passage, albeit in an earlier edition of Buckley, was cited with approval by Mr Justice Plowman in Re National Bank Limited [1966] 1 WLR 819 and also by Mr Justice David Richards, as he then was, in Telewest Communications Plc (No.2) Re [2004] EWHC 1466 (Ch). More recently, in Re TDG Plc [2009] 1 BCLC 445 Mr Justice Morgan drew together four matters which required attention when the court is considering whether to sanction any proposed scheme of arrangement. These in a sense echo and summarise the propositions set out in Buckley, as approved National Bank Limited and Telewest Communications (No.2). They are as follows:[35]First, the court must be satisfied that the provisions of the statute have been complied with. For reasons which I have explained, I think they have been.[36]Secondly, the court must be satisfied that the class of shareholders, the subject of the court meeting(s), were fairly represented by those who attended the meeting and the statutory majority are acting bona fide and not coercing the minority in order to promote interests adverse to those of the class they represent. This is a different issue to the statutory majority requirement which concerns the number for mathematical count and it requires consideration of whether any vitiating interest motivated the majority in achieving the actual result. This, as I have indicated, is the matter to which I shall return.[37]The third question is whether an intelligent and honest person, a member of the class concerned acting in respect of his own interests might reasonably approve the scheme. That requires the court in a sense to stand back and consider whether the scheme could be said to be irrational and to have been promoted against reason.[38]Finally, there must be no, so-called, ‘blot’ on the scheme. I note that ‘blot’ is a slightly quaint term but it is generally thought to refer to some technical or legal defect in the scheme. For example, that it does not work according to its own terms or that it would infringe some mandatory provision of the law. I am satisfied in the last respect that there is no such blot.[39]The real points to which I must return are whether the voting could be said to have been influenced or over-influenced by the position of Mr Käärmann. It is the fact that in each case the cap which applies to voting rights was disapplied in the case of the relevant court meetings and in consequence there is no doubt that, looked at simply, it was Mr Käärmann's vote which procured the result. Prior to the commencement of the hearing, I inquired of Mr Thornton what would be the result if the votes of Mr Käärmann were stripped out and Mr Thornton replied almost immediately, though some considerable thought had been given to it, with an extremely useful description on a number of permutations of what would be the result of stripping out Mr Käärmann's or Skaala's votes in the case of both class A and B meetings.[40]Also, and perhaps most interestingly, he addressed what would have been the result of first, the class A meeting, without holders who were also class B voters, that is to say, stripping out Mr Käärmann and Skaala. Mr Thornton invited me to take that parameter as the best litmus test of what the shareholders of other Mr Käärmann and Skaala actually thought of the Scheme and as to where their best economic interest lay. The figures which he relied on in that regard were that stripping out the holders who also held class B shares, which were largely Mr Käärmann and Skaala but also included Bailie Gifford, the result of the meeting would have been 92.8 per cent for and some 7.2 per cent against. That is to say a very substantial clearance over the statutory requirement.[41]I have been most assisted by these figures. In any case where there is a predominant voice the court is necessarily more sceptical about the overall result of the meeting and it should, and I think ordinarily does, interrogate the result as I had sought to and have been hugely assisted by what has been provided.[42]I am satisfied that the best litmus test of where the interests of the shareholders who do not have any, as it were, personal interest in the extension of the class B voting rights for 10 years lay is in the last parameter provided.[43]I did ask Mr Thornton what the evidential basis for the justification which was in a sense advanced as justifying this extension as being the preservation of the vision-based drive, which is something that technology companies particularly value.[44]My concern was that the explanatory material is somewhat conclusive in this regard without providing evidence as to the respective merits in terms of shareholder performance according to whether there are such shares with such voting rights or not. Mr Thornton countered this by reminding me of the essential question. The essential question for the court is not to determine whether shareholders will or will not benefit, it is to determine whether a reliable proportion of them think that they would benefit and the court then has to be satisfied that their thoughts in that regard are rational as opposed to irrational. I do not think there is a sufficient basis for me to categorise that conclusion as irrational especially since it is in fact supported by broker advisors who had advised on the Scheme, including this extension of the class B voting rights. Nor do I think it is appropriate for me to substitute some inevitably personal and subjective view as to the best interests of the shareholders over and above the evidence of what the majority on the last of the parameters provided by Mr Thornton appears to establish.[45]In other words, I think I would be substituting my own guess for their assessment and I do not think that would be appropriate. I should add that in fact I do not feel able to guess one way or the other and that is part of the problem. I have in my reading considered the objections put forward in July 2025 by Skaala and Mr Thornton has sufficiently to my mind taken me through them. I have considered also the views of a 0.2 per cent holder, who did consider that the extension of the voting rights was not appropriate and voted against. I do not consider these views carry such logic or weight as to persuade me to refuse to sanction the Scheme.[46]Overall, I am satisfied that I should in my discretion sanction the Scheme adding only the following points.[47]First, there is an issue in this case relating to sanction regimes both in the UK and US. Provisions have been made for the rights attached to the shares which may be subject to sanction regimes to be neutralised and that careful consideration has been given to abiding with the sanctions regime accordingly.[48]Second, I should note that driven in a sense by the exigencies of the first listing in the US, the Company is changing its registrar.[49]Third, I have been provided with a statement by Jean Park, a partner at Cooley LLP in New York, that being the primary office of Cooley in the US advising on this matter, whereas this Scheme has been prepared by Cooley LLP's London office advising that the exemption in 3(a)(10) of the US Securities Act should be available. Mr Thornton was entirely plain with me that that could not satisfy the requirements of expert evidence but in a case prior to this, I think I have eventually relented on my initial feeling that an independent expert was required in this regard, provided the evidence offered is consistent and sufficiently compelling. This, I would caution, is without prejudice to my taking a restricted view where the matter is not so well travelled or almost invariable, as is the position with respect to 3(a)(10).[50]Relying also on the fact for this judgment that this Company has a majority of independent directors on the board and the unanimous recommendation of the board is to be given more credence accordingly, I propose to sanction the Scheme. Epiq Europe Ltd hereby certify that the above is an accurate and complete record of the proceedings or part thereof. Lower Ground, 46 Chancery Lane, London WC2A 1JE Email: civil@epiqglobal.co.uk