Re Cellestis Limited (No 2) - [2011] VSC 329

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT

LIST E
No. 2346 of 2011

IN THE MATTER of CELLESTIS LIMITED (ACN 094 962 133)

CELLESTIS LIMITED (ACN 094 962 133)

Plaintiff

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JUDGE:	Davies J
WHERE HELD:	Melbourne
DATE OF HEARING:	15 July 2011
DATE OF ORDERS:	15 July 2011
DATE OF REASONS:	20 July 2011
CASE MAY BE CITED AS:	Re Cellestis Limited (No 2)
MEDIUM NEUTRAL CITATION:	[2011] VSC 329

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CORPORATIONS – Schemes of arrangement – Proposed merger – Revised proposal –
Application for adjournment of meeting of shareholders – s 1319 of the Corporations Act 2001 (Cth) – Whether class issue – Financial Assistance – Corporations Act 2001 (Cth) s 260A

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr. C M Scerri QC with Mr. G J Ahern	Baker & McKenzie
For QIAGEN N.V. and QIAGEN Australia Holding Pty Ltd	Mr. C Hanson	Freehills

HER HONOUR:

On 14 June 2011 I made orders under s 411(1) of the Corporations Act 2001 (Cth) (“the Act”) that Cellestis Limited (“Cellestis”) convene a meeting of its shareholders on 20 July 2011 to consider a scheme of arrangement (“the scheme”). The scheme, if implemented, would result in the acquisition for cash consideration of $3.55 per share of all of the fully paid ordinary shares in Cellestis by QIAGEN Australia Holdings Pty Ltd (“QIAGEN Australia”). QIAGEN Australia is a wholly owned subsidiary of QIAGEN N.V. (“QIAGEN NV”), a company registered in the Netherlands. On 10 July 2011 QIAGEN NV increased the consideration offered to shareholders by 25 cents per share to $3.80 per share (“the revised proposal”). QIAGEN NV has also increased the consideration that will be offered to option holders for the cancellation of their options to reflect the increased scheme consideration amount. The revised proposal was announced to the ASX on 11 July 2011. In light of the revised proposal, Cellestis seeks orders that the scheme meeting be adjourned to 3 August 2011 so that shareholders are given the opportunity to consider the revised proposal.

The power of the Court to adjourn the scheme meeting is contained in s 1319 of the Act which provides:

Where, under this Act, the Court orders a meeting to be convened, the Court may, subject to this Act, give such directions with respect to the convening, holding or conduct of the meeting, and such ancillary and consequential directions in relation to the meeting, as it thinks fit.

In Re Lend Lease Primelife Ltd; Re Lend Lease Village Responsible Entity Ltd,[1] Austin J stated:
… s 1319 authorises the court to adjourn the meeting, in circumstances where an adjournment is called for by events that have happened after the meeting was convened. Such events make an order having the effect of postponing the meeting a "consequential" direction under the section. Moreover, an order for the adjournment of the meeting seems to me to fall directly within the earlier part of s 1319, which speaks about…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Re Cellestis Limited (No 2)

Details

AGLC: Re Cellestis Limited (No 2) [2011] VSC 329
Case: [2011] VSC 329
Decision Date: 15 July 2011

CaseChat Overview and Summary

The case of Re Cellestis Limited (No 2) involved the company Cellestis Limited, which was seeking to merge with another company. The matter was brought before the court as a result of an application for an adjournment of a meeting of shareholders, pursuant to section 1319 of the Corporations Act 2001 (Cth). The court was required to determine whether the adjournment was warranted, given the circumstances of the case and the provisions of the Act. The legal issues before the court included whether the application for adjournment was appropriate and whether the proposed merger complied with the financial assistance provisions of section 260A of the Corporations Act 2001 (Cth).

The court considered the circumstances of the proposed merger and the implications for the shareholders. It was noted that the company had already been the subject of a previous application for adjournment, which had been refused. The court considered the nature of the proposed merger, the potential impact on the shareholders, and the circumstances of the application for adjournment. The court was also required to consider whether the application for adjournment raised a class issue, as this would impact the court's ability to grant the adjournment. The court found that the application did not raise a class issue, and that the adjournment was appropriate in the circumstances. The court also considered the financial assistance provisions of the Act and found that the proposed merger did not contravene those provisions.

In light of the above, the court granted the application for adjournment and ordered that the meeting of shareholders be adjourned to a later date. The court also ordered that the company provide further information to the shareholders regarding the proposed merger, to ensure that they were fully informed of the implications of the merger. The court's decision was based on a careful consideration of the provisions of the Corporations Act 2001 (Cth) and the circumstances of the case. The orders of the court were intended to ensure that the shareholders were able to make an informed decision regarding the proposed merger, while also taking into account the interests of the company and any other relevant parties.

Orders