Blaze Asset Pty Ltd v Target Energy Ltd

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FEDERAL COURT OF AUSTRALIA

Blaze Asset Pty Ltd v Target Energy Limited [2009] FCA 698

CORPORATIONS – application to extend time to lodge supplementary bidder's statement – application to extend time to further vary bid – extent of Court's powers to make orders under s 1322(4)(d) Corporations Act 2001 (Cth) – orders made as asked

Corporations Act 2001 (Cth) s 263(1), s 624, s 624(1), s 624(2), s 624(2)(a), s 630(3), s 650D(1), s 650D(1)(b), s 650D(1)(c)(ii), s 650E, s 650E(1), s 650E(1)(b), s 650E(1)(G), s 650F, s 650F(1), s 650F(3), s 650G, s 671B(1)(b), s 1322, s 1322(4), s 1322(4)(a), s 1322(4)(b), s 1322(4)(d), s 1322(6)(c), s 1325(D), Ch 6, Ch 6A, Ch 6B, Ch 6C

Community Life Ltd v Kilmory Developments Pty Ltd  [2007] NSWSC 943
Diamond Rose NL v Striker Resources NL (1998) 85 FCR 76
Primelife Corporation Ltd v Aevum Ltd (2005) 53 ACSR 283
Re Centennial Coal Co Ltd [2006] NSWSC 62
Re Emerald Capital Ltd [2008] FCA 1739
Re Insurance Australia Group Ltd (2003) 128 FCR 581
Re Laserbond Ltd (2003) 25 ACLC 1
Re MacMahon Holdings Limited [2008] FCA 1079
Re Wave Capital Limited (2003) 21 ACLC 1
Winpar Holdings Ltd v Goldfields Kalgoorlie Ltd (2001) 166 FLR 144

BLAZE ASSET PTY LTD v TARGET ENERGY LIMITED

WAD 100 of 2009

BARKER J
26 JUNE 2009
PERTH


IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY

WAD 100 of 2009
BETWEEN:

BLAZE ASSET PTY LTD
Plaintiff
AND:

TARGET ENERGY LIMITED
Defendant

JUDGE:

BARKER J

DATE OF ORDER:

26 JUNE 2009

WHERE MADE:

PERTH

THE COURT ORDERS THAT:

1.The time for service of the originating process in this action be abridged.

2.The time for lodgement of the plaintiff's notice of variation (being the supplementary bidder's statement dated 5 June 2009) dated 5 June 2009 is extended to 8 June 2009.

3.The time to lodge a notice of variation (notice) as required by s 650D(1) of the Corporations Act 2001 (Cth) with ASIC is extended to 4pm on the date of these orders provided that:

(a)       the notice informs the recipients that:

(i)        the notice has been sent by order of this Court;

(ii)the offer period is due to expire on 17 July 2009 unless otherwise extended by the plaintiff; and

(iii)the offer is freed from all defeating conditions; and

(iv)the time for payment of the consideration under the takeover bid for all persons who had accepted the offer prior to the date of the notice is accelerated to 19 July 2009; and

(b)the plaintiff lodges the notice with ASIC and ASX by 4pm on the date of these orders; and

(c)within 3 days after the date of these orders the plaintiff sends the notice to the defendant and to everyone to whom offers were made under the plaintiff's bidder's statement dated 16 April 2009.

4.The time for lodgement of the notice in s 630(3) is extended to 4pm on the date of these orders.

5.Costs reserved, in the event the parties cannot agree…

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Details
Case
[2009] FCA 698
Decision Date

CaseChat Overview and Summary

The case of Blaze Asset Pty Ltd v Target Energy Ltd involved Blaze Asset seeking various orders from the court to facilitate its takeover bid for Target Energy Ltd. Blaze requested the court to abridge the time for service of the originating process and extend deadlines for lodging various notices, including a supplementary bidder’s statement and a notice of variation with the Australian Securities and Investments Commission (ASIC). The key legal issues the court needed to address were whether the requested time extensions were appropriate and whether they would protect the interests of existing shareholders.

The court considered the urgency of Blaze's requests and the potential impact on Target’s shareholders, particularly those who had accepted the offer before the notices were properly lodged. The court determined that extending the time for lodging the notice of variation, subject to certain conditions, would be appropriate. These conditions included informing recipients that the notice had been sent by the court's order, clarifying the offer expiration date, and ensuring the offer was free of defeating conditions. Additionally, the court ordered that the time for payment of the consideration for shareholders who had accepted the offer prior to the notice be accelerated. The court's decision aimed to balance the procedural needs of Blaze with the protection of Target's shareholders.

Ultimately, the court granted Blaze's requests with the specified conditions, thereby ensuring the takeover bid could proceed under the revised terms while safeguarding the rights of existing shareholders. The orders included abridging the time for service of the originating process, extending the deadline for lodging the supplementary bidder's statement, and extending the deadline for lodging the notice of variation with ASIC and ASX. Costs were reserved pending agreement between the parties within 14 days.

Orders

Orders of the court

1. The time for service of the originating process in this action be abridged.

2. The time for lodgement of the plaintiff's notice of variation (being the supplementary bidder's statement dated 5 June 2009) dated 5 June 2009 is extended to 8 June 2009.

3. The time to lodge a notice of variation (notice) as required by s 650D(1) of the Corporations Act 2001 (Cth) with ASIC is extended to 4pm on the date of these orders provided that:

(a) the notice informs the recipients that:

(i) the notice has been sent by order of this Court;

(ii) the offer period is due to expire on 17 July 2009 unless otherwise extended by the plaintiff; and

(iii) the offer is freed from all defeating conditions; and

(iv) the time for payment of the consideration under the takeover bid for all persons who had accepted the offer prior to the date of the notice is accelerated to 19 July 2009; and

(b) the plaintiff lodges the notice with ASIC and ASX by 4pm on the date of these orders; and

(c) within 3 days after the date of these orders the plaintiff sends the notice to the defendant and to everyone to whom offers were made under the plaintiff's bidder's statement dated 16 April 2009.

4. The time for lodgement of the notice in s 630(3) is extended to 4pm on the date of these orders.

5. Costs reserved, in the event the parties cannot agree costs within 14 days.

Note:

Background

Background to the litigation

Blaze sought orders in the following terms:1.The time for service of the originating process in this action be abridged.2.The time for lodgement of the plaintiff's notice of variation (being the Supplementary Bidder's Statement (SBS) dated 5 June 2009) dated 5 June 2009 is extended to 8 June 2009.3.The time to lodge a notice of variation as required by s 650D(1) of the Corporations Act 2001 (Cth) (notice) with ASIC is extended to 4pm on the date of these orders provided that:(a)the notice informs the recipient that:(i)the notice has been sent by order of this Court;(ii)the offer period is due to expire on 17 July 2009 unless otherwise extended by the plaintiff; and(iii)the offer is freed from all defeating conditions; and(b)the plaintiff lodges the notice with ASIC and ASX by 4pm on the date of these orders; and(c)within three days after the date of these orders the plaintiff sends the notice to the defendant and to everyone to whom offers were made under plaintiff's bidder's statement dated 16 April 2009.4.The time for lodgement of the notice in s 630(3) is extended to 4pm on the date of these orders.FACTS GIVING RISE TO THE APPLICATION On 8 April 2009, Blaze announced on the ASX companies' platform its intention to make a takeover bid for Target. On 17 April 2009, Blaze lodged its bidder's statement with ASIC and ASX and served the bidder's statement on the defendant. The bidder's statement specified that the offer closed at 5pm (Perth time) on 5 June 2009 unless it was withdrawn or extended in accordance with the CA (see cl 2.7). On 5 June 2009, Blaze lodged its initial substantial holder's notice with ASIC and announced this to ASX. On 5 June 2009, Blaze purported to increase the consideration offered under the takeover. This was announced to ASX together with the relevant SBS. On 5 June 2009, Alexander John Devlin McHenry, corporate consultant engaged to assist Blaze in the takeover, posted the SBS by ordinary mail to ASIC's mailing address. The SBS was received by ASIC for the purposes of lodgement on 8 June 2009. On 11 June 2009, Blaze announced an extension of the offer period for four weeks and lodged a notice of variation with ASIC. On 19 June 2009, Target released an announcement on the revised offer consideration recommending to shareholders that they do nothing. On or about 10 June 2009, Garrick John Archer, a solicitor employed in the firm of solicitors acting for Blaze in this proceeding, and who had the conduct of the firm's assistance to the plaintiff in the takeover, was telephoned by Michelle Cobb of ASIC. Ms Cobb advised Mr Archer that the SBS was the notice of variation for the increased consideration under the takeover and that a $1,000 filing fee had not been paid for the filing of the SBS and that she would contact Blaze for payment in that amount. At approximately 4pm on 16 June 2009, Mr Archer was telephoned by Kim Demarte and Michelle Cobb of ASIC. Mr Demarte informed Mr Archer that the SBS was posted to ASIC on 5 June 2009 and received by ASIC on 8 June 2009. Mr Demarte said this meant that the offer period for the takeover had expired – on 5 June 2009 and any subsequent variation of the takeover period was ineffective under s 650D(1) of the CA.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

BARKER J
In those circumstances, I consider the amendment to order 3 by the insertion of (a)(iv), as proposed by Blaze, to be an appropriate protection of existing shareholder's interests in the case of those shareholders who have to date accepted the offer.CONCLUSION AND ORDER For the reasons given above, I would exercise the powers of the Court under s 1322(4)(b) of the CA to make the orders sought by the plaintiff. Subject to the finally hearing from counsel as to the terms and form of the orders, I would order that:1.The time for service of the originating process in this action be abridged.2.The time for lodgement of the plaintiff's notice of variation (being the supplementary bidder's statement dated 5 June 2009) dated 5 June 2009 is extended to 8 June 2009.3.The time to lodge a notice of variation (notice) as required by s 650D(1) of the Corporations Act 2001 (Cth) with ASIC is extended to 4pm on the date of these orders provided that:(a) the notice informs the recipients that:(i) the notice has been sent by order of this Court;(ii)the offer period is due to expire on 17 July 2009 unless otherwise extended by the plaintiff; and(iii)the offer is freed from all defeating conditions; and(iv)the time for payment of the consideration under the takeover bid for all persons who had accepted the offer prior to the date of the notice is accelerated to 19 July 2009; and(b)the plaintiff lodges the notice with ASIC and ASX by 4pm on the date of these orders; and(c)within 3 days after the date of these orders the plaintiff sends the notice to the defendant and to everyone to whom offers were made under the plaintiff's bidder's statement dated 16 April 2009.4.The time for lodgement of the notice in s 630(3) is extended to 4pm on the date of these orders.5.Costs reserved, in the event the parties cannot agree costs within 14 days.

Ratio Decidendi

Legal Principle Established

Established by: BARKER J

Full text does not contain this section.