Lionsgate Australia Pty Ltd v Macquarie Private Portfolio Management Ltd

The case of Lionsgate Australia Pty Ltd v Macquarie Private Portfolio Management Ltd involved a dispute between a shareholder of a company, Lionsgate Australia, and a prospective bidder, Macquarie Private Portfolio Management. The shareholder had entered into a deed with the prospective bidder under an off-market bid, agreeing to accept the bidder's bid except in the case where a "higher offer" was made. The prospective bidder subsequently sought to acquire all of the shares in the target company by way of an off-market bid. The issue before the court was whether the existence of the prior deed caused the off-market bid to offend sections 619 or 627 of the Corporations Act. Additionally, the court considered whether damages would be an adequate remedy for breach of the prior deed.

The court held that the prior deed did not cause the off-market bid to offend sections 619 or 627 of the Corporations Act. The court found that the term "higher offer" in the prior deed did not encompass the scheme of arrangement announced by the target company and the prospective competing acquirer. The court also held that damages would not be an adequate remedy for breach of the prior deed, and that specific performance was the appropriate remedy. The court found that the prior deed was intended to secure a strategic parcel of shares in the target company, and that the bidder's off-market bid was a means to achieve this objective. The court concluded that the bidder was entitled to specific performance of the prior deed.

The court ordered that the prospective bidder be granted specific performance of the prior deed, and that the shareholder be restrained from taking any action that would prevent the bidder from acquiring the strategic parcel of shares in the target company. The court also ordered that the shareholder be liable to pay the bidder's costs of the proceedings. This decision highlights the importance of carefully drafting and interpreting contractual agreements, particularly in the context of complex corporate transactions.