Did Jardines shortchange shareholders by US$4 billion?

In Noble House, James Clavell’s portrait of Jardine Matheson, the great trading dynasty is locked in an unending fight to preserve the family grip against circling enemies and the pressures of modern markets.

In the real world, a dispute with minority shareholders over how the conglomerate valued its main investment arm, Jardine Strategic, has been grinding through the courts for four years. It may lack the pace and spectacle Clavell enjoyed putting on the page, but familiar frictions have emerged and in true Noble House style, both sides appear resolved to a long war of attrition.

Leading the offensive on behalf of the shareholders is a group of event-driven hedge funds making an arbitrage bet that an April 2021 squeeze-out of Jardine Strategic shareholders at US$33 per share was woefully underpriced. The 90-strong investor group, including Attestor Value, Blackwell Partners, Citadel, Helium Opportunities, Man Group, Maso Capital, Oasis Investments and Stonehill Institutional Partners, have asked a Bermuda court to determine a “fair value” for their shares.

At the time, the US$5.5 billion deal was widely criticised for exploiting cracks in global regulatory systems, not least because the parent—holding 85% of the shares—was permitted to vote on the transaction. The offer price also fell 76% short of Jardine Strategic’s net asset value of US$58.22 per share. A buyout at this rate would have cost the company around US$9.7 billion.

The two sides have thrown substantial legal weight at each other over the past four years and some of the decisions handed down so far reach well beyond this case, shaping the rights of shareholders more broadly. In this article, we recap the case so far, map out what lies ahead and look at where the fight is likely to get most interesting.

Who is winning the pre-trial tussles?

Wins and losses have been traded across the courts of Bermuda, London, Delaware and New York, producing more than a dozen written judgments. Some turn on narrow points; others reach much further, influencing shareholder rights well beyond the Jardines dispute.

Most crucially for the dissenters, the hedge fund cohort saw off an early challenge by Jardines to knock them out of the game. The company had argued that appraisal arbitrageurs were not the type of long-term shareholder the legislation had in mind, a salvo that would have hollowed out the dissenters. Jardines had estimated that event-driven hedge funds accounted for around 84% of the plaintiffs by value.

The case climbed the judicial ladder all the way to the Privy Council in London, which sided with the hedge funds in July 2025 after a hearing which drew leading King’s Counsel on both sides—and Adam Keswick, executive director at Jardines and cousin to executive chairman Ben Keswick. His presence, seated just behind Jardines’ legal team, suggests the family is following the litigation at close range.

In a parallel challenge, the top court around the same time handed a significant victory to Jardines—indeed, to companies more broadly—when the dissenters sought access to the legal advice the company had taken in setting the US$33 offer price.

The dissenters tried to invoke the so-called “shareholder rule”, a doctrine that permitted investors, as members of a company, to inspect privileged legal advice it had obtained. But the Privy Council concluded the time had come to abolish the principle as a relic of 19^th century company law—a shift that carries consequences for shareholders well beyond this case, as it tilts the balance of information firmly toward management and controlling shareholders.

This was not the only fissure over evidential disclosure to go Jardines’ way. The dissenters from the outset tried to secure a wide discovery order against the entire group of companies, but the Bermudan courts narrowed the scope. The group employs more than 400,000 people (the court noted this is equivalent to 12 times the working population of Bermuda) and consists of around 1,150 companies. A broad discovery order, it said, would have resulted in a potential 35 million pages of documentation.

Instead, an online depository (the “Data Room”) was set up by Jardines with core valuation documents. Dissenters could then make additional requests for specific information. Several skirmishes tested the limits of this order, and the company rebutted requests when these documents fell beyond its possession, control or power.

What happens next?

Both sides have appointed valuation experts (the dissenters have appointed Mark Bezant of FTI Consulting), who will construct models and methodologies to determine what they believe the shares were worth at the time of the transaction—the date Jardine Strategic was amalgamated with its parent, 12 April 2021. The experts’ reports, often running to hundreds of pages, will also dismantle the other side’s assumptions.

Given the magnitude of the underlying assets, the complexity of the structure and the breadth of issues, there is a strong likelihood the Jardines appraisal could rank among the largest and most significant to date. One of the Bermuda judges, Mr Justice Andrew Martin in November 2024 summed up the task ahead: “…the scale of the valuation in this case is enormous, and the values involved are gargantuan.’’

Expect further disagreements over the scope of documents to be disclosed. Unless the parties settle on confidential terms—which is the fate of most offshore appraisal cases—the case will move to trial. A date is not expected until 2027.

It is up to the judge to hear evidence and decide on the most credible path to fair value. In some cases, the court chooses one party’s valuation model, or takes a “blended” approach, giving different valuations more weight than another. Or one measure may be used as a cross-check against another. 

Given the size of the dispute, a written judgment may not emerge until 2028. Comparable litigation in Cayman tends to run for years. Two large-scale, highly contested appraisal cases, Sina Corporation and 58.com, held trials in mid-2025 and judgments are still pending. Both cases date back to 2020. 

Where will things get interesting

The real drama will unfold in how the two sides attack each other’s valuations. The dissenters appear set on a sum-of-the-parts (SOTP) approach that disassembles the group asset by asset, while Jardines seems to favour a top-down, market-based framework built around trading prices. That clash of methodologies is likely to dominate the trial.

Mr Justice Andrew Martin has already warned against prejudging which approach will prevail, noting that whether a sum-of-the-parts, discounted cash flow (DCF), or market-based measures should carry the most weight is a question for the evidence and the full appraisal hearing. His comments reflects what typically happens in appraisal litigation: companies prefer market-based metrics they say reflect real-time pricing by actual buyers and sellers, while dissenters gravitate toward DCF and SOTP models, or a blend of the two, that allow deeper scrutiny of internal numbers.

Here that contrast will be unusually stark. The US$33 offer was justified publicly almost entirely on trading prices, with the shareholder circular providing little insight into the methodology behind it. By contrast, through discovery, the dissenters have sought extensive group-level documents—management accounts, budgets, forecasts, board papers and subsidiary-level financials—to test how the business performed and whether management projections were conservative, optimistic, or shaped by the turbulence of Covid and Hong Kong’s social unrest. The court’s view on the reliability of those market signals—particularly in a company with an 85% controlling shareholder and limited free float—will be pivotal.

Another major area of debate during trial is likely to focus on Jardines’ architecture: its circular cross-holdings, inter-company flows and the long-debated conglomerate discount. Dissolvers will likely argue these features obscure where value actually sits; Jardines may counter that the market has priced them in for decades.

The financial basis for the valuation must be sound, but the company must also show it was rigorously tested. The role of the Jardine Strategic Transaction Committee and financial advisors to the transaction, Evercore, will be under the microscope. Expect a full interrogation of how both approached company numbers, and whether their assessments reflect independent judgment rather than deference to management or procedural formality.

The two members of the Transaction Committee were Jardine Strategic directors who did not have a seat on the Jardine Matheson board, Lincoln Leung and Charles Powell, otherwise known as Lord Powell of Bayswater. Still, both were stalwarts at other companies within the group: Leung was a non-executive director of Mandarin Oriental for nearly a decade. Lord Powell was a Jardine Matheson director for 8 years until 2000 and has been on the board of Matheson & Co since 1991.

Were they arm’s length decision-makers, or were they institutionally aligned with the Group’s controlling family and culture?

In the appraisal of ASX-listed NKWE Platinum, Bermuda’s Supreme Court in February 2025 took issue with two independent directors appointed to scrutinize an offer price who lacked the “gumption to stick to their guns’’ in seeking a better deal.

The directors took no independent legal or financial advice, left almost no paper trail of their deliberations, and compromised on their view of what fair value was after the bidder declined to increase the offer.

The judgment suggests that passive committees—especially in controlled companies—invite heightened scrutiny, and that independent directors must actively interrogate valuation, not outsource judgment to advisors.

Similarly, the offshore courts will probe whether financial advisors (Evercore Partners International were financial advisors to the Jardine Strategic Transaction Committee; Slaughter & May provided legal advice) were commercially aligned with controlling shareholders, relied too heavily on management numbers, or failed to challenge their assumptions. For companies facing an appraisal, this means every step of the valuation process—advice, governance and documentation—must withstand judicial scrutiny.

Does fairness matter?

Yes and no. As we explain in our separate article, “Jardines and the economics of dissent”, Bermuda’s corporate framework gives minority shareholders only modest protection in a squeeze-out. The court is not there to decide whether the deal is fair in the colloquial sense. It will not revisit the political debate that followed the transaction or validate complaints that the minority was short-changed.

But fairness matters indirectly. Courts are injecting procedural discipline into appraisals by requiring companies to justify—often in granular detail—how they arrived at the offer price. The breadth and reliability of the information fed into a valuation will be closely examined, and if the court suspects that management curated, withheld, or selectively framed key inputs, the company’s model is given less weight. The same applies to forecasts: if projections appear to understate the company’s future earning power, the court may be inclined to look elsewhere.

“Information asymmetry’’ has become a recurring flashpoint. In Nord Anglia Education Inc (2020), the Cayman Grand Court rejected the company’s attempt to anchor fair value solely to historic market price, holding that the market lacked access to value-relevant non-public information—including management projections and other internal data—necessary to form a reliable view of worth.

It is through that lens that Jardines, too, will be assessed. If the case proceeds to full trial, any judgment is likely to speak as much to process as to price—how independent committees should behave, what constitutes meaningful challenge, and how competing valuation methods ought to be weighed.

Jardines may be the immediate battleground, but the implications will extend far beyond it: to controlled companies navigating squeeze-outs, to arbitrage funds testing the limits of appraisal, and to courts still working out how to balance entrenched power with modern expectations of transparency and accountability.

Copyright: Ninepin Ltd, 2026