Neo Resources Ltd, in the matter of Neo Resources Ltd (No 2)
[2013] FCA 1013
•29 August 2013
FEDERAL COURT OF AUSTRALIA
Neo Resources Ltd, in the matter of Neo Resources Ltd (No 2) [2013] FCA 1013
Citation: Neo Resources Ltd, in the matter of Neo Resources Ltd (No 2) [2013] FCA 1013 Parties: NEO RESOURCES LTD (ACN 007 708 429) File number(s): WAD 223 of 2013 Judge(s): SIOPIS J Date of judgment: 29 August 2013 Date of hearing: 29 August 2013 Place: Perth Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 14 Counsel for the Plaintiff: Mr MJ Feutrill Solicitor for the Plaintiff: Steinepreis Paganin
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 223 of 2013
IN THE MATTER OF NEO RESOURCES LTD (ACN 007 708 429)
NEO RESOURCES LTD (ACN 007 708 429)
Plaintiff
JUDGE:
SIOPIS J
DATE OF ORDER:
29 AUGUST 2013
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.Pursuant to section 411(4)(b) of the Corporations Act 2001 (Cth) (Corporations Act) the scheme of arrangement between the plaintiff and its members, set out in Exhibit LA-1 Tab 2 of the affidavit of Ms Lisa Ahwan, dated 9 August 2013, is approved.
2.Pursuant to section 411(12) of the Corporations Act, the plaintiff is exempted from compliance with section 411(11) of the Corporations Act, in relation to the scheme of arrangement referred to in order 1.
3.The plaintiff is to lodge an office copy of these orders with the Australian Securities and Investments Commission as soon as practicable.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 223 of 2013
IN THE MATTER OF NEO RESOURCES LTD (ACN 007 708 429)
NEO RESOURCES LTD (ACN 007 708 429)
Plaintiff
JUDGE:
SIOPIS J
DATE:
29 AUGUST 2013
PLACE:
PERTH
REASONS FOR JUDGMENT
This is an application for the making of orders for the approval of a scheme of arrangement pursuant to s 411(4) of the Corporations Act 2001 (Cth).
On 16 July 2013, Barker J made orders for the convening of a meeting of the members of Neo Resources Limited (the company) for the purpose of considering and, if thought fit, approving a scheme of arrangement between the company and its members.
In short, the scheme provides for an arrangement whereby all the shares in the company would be acquired for the scheme consideration by the bidding company, Perpetual Resources Limited (Perpetual). The consequence of the implementation of the scheme will be that the company will become a wholly owned subsidiary of Perpetual.
The principles which apply on the second court hearing in relation to the approval of a scheme of arrangement are well-known. They are set out in the observations of Santow J in the case of Re NRMA Ltd (2000) 33 ACSR 595 at [41] (NRMA). In summary, the Court will need to be satisfied that the conditions required by s 411 of the Corporations Act have been complied with; the scheme has been proposed in good faith and not in pursuit of some illegitimate purpose; and, that the scheme is at least so fair and reasonable that an intelligent and honest person acting independently in respect of his or her interests, might approve it.
As Santow J went on to observe in NRMA, the jurisdiction of the Court is supervisory in the sense that the Court’s concern is to be satisfied that there has been an absence of oppression and that the arrangement is one which is capable of being accepted.
I have had the benefit of very helpful and comprehensive submissions from counsel for the company. Attached to those submissions is a document which identifies passages in a number of affidavits evidencing compliance with the relevant provisions of s 411 and also with the orders of the Court made on 16 July 2013.
There is also in evidence an affidavit from Mr Peter Torre, who chaired the meeting of members of the company at which the entry into the scheme of arrangement was proposed. The evidence shows that the majorities referred to in s 411(4) were very comfortably satisfied. In relation to the number of shareholders voting, 99.28% voted in favour and, in relation to the number of votes cast, 99.99% voted in favour of entry into the scheme.
As to the question of s 411(17) of the Corporations Act, there is evidence before the Court from Mr John Murray that the Australian Securities and Investments Commission has provided the usual letter under s 411(17)(b) to the effect that it has no objection to the making of orders for the approval of the scheme. Further, there are no circumstances which have been dawn to my attention which might cause me to exercise the residual discretion under s 411(17) against the making of the orders.
In considering whether the scheme of arrangement is fair and reasonable in the sense called for at the second hearing, the Court places weight upon the way in which the members themselves have perceived the character of the scheme. In this case, it is clear from the overwhelming support for the scheme, that the members have the view that the scheme is fair and reasonable. The same view has been expressed in the expert report in the scheme booklet.
Also, one can infer from the extent of the support for the scheme, that there has not been anything oppressive in relation to the way in which the scheme was conceived or voted upon.
Further, today’s hearing has been advertised in accordance with the previous orders made by the Court. Anyone opposed to the scheme has had the opportunity to attend Court today, to do so. No one has appeared in opposition to the making of the orders.
In the circumstances, I am content to make the orders for the approval of the scheme of arrangement.
In addition, the company has asked that the Court make an order exempting the plaintiff from compliance with s 411(11) of the Corporations Act, which requires that the Court’s order be annexed to every copy of the company’s constitution. As counsel has said in his submissions, there is no real benefit to be served by the annexing of the order, in light of the fact that the company now will become a wholly owned subsidiary of Perpetual. In these circumstances, I am content to make the order sought.
The scheme of arrangement is appendix 2 to the scheme booklet. I will make orders identifying the scheme by reference to that booklet which is in turn an exhibit to the affidavit of Ms Lisa Ahwan dated 9 August 2013.
I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis. Associate:
Dated: 4 October 2013
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