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Re Coca-Cola Amatil Ltd

Re Coca-Cola Amatil Ltd

Case [2021] NSWSC 489 7 May 2021

Contract Formation

Scheme of Arrangement

Approval of Scheme

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Coca-Cola Amatil Limited [2021] NSWSC 489
Hearing dates: 20 April 2021
Date of orders: 20 April 2021
Decision date: 07 May 2021
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Orders made approving the scheme of arrangement.

Catchwords:
CORPORATIONS – Arrangements and reconstructions – Schemes of arrangement or compromise – Application under s 411 of the Corporations Act 2001 (Cth) for orders approving scheme of arrangement – Where formal requirements satisfied – Whether scheme of arrangement should be approved.

Legislation Cited:
- Corporations Act 2001 (Cth), s 411

Cases Cited:
- Re Amcor Limited (No 2) [2019] FCA 842
- Re Anaconda Nickel Holdings Pty Ltd (2003) 44 ACSR 229; [2003] WASC 19
- Re Atlas Iron Ltd (No 2) [2016] FCA 481
- Re Aveo Group Ltd and Aveo Funds Management Ltd [2019] NSWSC 1679
- Re Central Pacific Minerals NL [2002] FCA 239
- Re David Jones Ltd (No 3) [2014] FCA 753
- Re Equinox Resources Ltd (2004) 49 ACSR 692; [2004] WASC 143
- Re GBST Holdings Ltd [2019] NSWSC 1503
- Re NRMA Ltd (No 2) (2000) 156 FLR 412; [2000] NSWSC 408
- Re Permanent Trustee Co (2002) 43 ACSR 601; [2002] NSWSC 1177
- Re Prime Infrastructure Holdings Ltd [2010] NSWSC 1337
- Re Redcape Property Fund Ltd and Trust Company (RE Services) Ltd (as the responsible entity for the Redcape Property Trust) [2012] NSWSC 486
- Re Seven Network Ltd (2010) 77 ACSR 701; [2010] FCA 400
- Re Solution 6 Holdings Ltd (2004) 50 ACSR 113; [2004] FCA 1049
- Re Texon Petroleum Ltd (No 2) [2013] FCA 147
- Re TPG Telecom Ltd [2020] NSWSC 978; BC202007131

Category: Principal judgment
Parties: Coca-Cola Amatil Limited (Plaintiff)
Representation:
Counsel:
I Jackman SC (Plaintiff)
J Williams SC (Acquirer)
Solicitors:
Herbert Smith Freehills (Plaintiff)
Corrs Chambers Westgarth (Acquirer)

File Number(s): 2021/50745

Judgment

Background and affidavit evidence

On 12 March 2021, I made orders convening a meeting to consider a scheme of arrangement in respect of Coca-Cola Amatil Limited (“Amatil”). Amatil now seeks an order under s 411(4)(b) of the Corporations Act 2001 (Cth) approving a scheme of arrangement between it and Independent Amatil Shareholders (as defined), being those shareholders other than certain Excluded Shareholders (as defined). The Excluded Shareholders are Coca European Partners plc (“CCEP”) and its subsidiaries and Coca-Cola Company and its subsidiaries, and any Amatil shareholder who holds shares in behalf of either of them.
Amatil relies on the affidavit dated 18 April 2021 of their solicitor, Mr Damian, which refers to several non-material amendments to the scheme booklet made after the first Court hearing on 12 March 2021, to the registration of the Scheme Booklet by the Australian Securities and Investments Commission (“ASIC”), the advertisement of the Court hearing, and the absence of any notice of an Amatil shareholder seeking to oppose the scheme at the second Court hearing. I should…

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 Coca-Cola Amatil Ltd

Details

AGLC: Re Coca-Cola Amatil Ltd [2021] NSWSC 489
Case: [2021] NSWSC 489
Decision Date: 07 May 2021

CaseChat Overview and Summary

Coca-Cola Amatil Limited, a major beverage company in Australia, was the subject of an application by the Australian Securities and Investments Commission for orders under section 411 of the Corporations Act 2001 (Cth). The Commission sought approval for a scheme of arrangement that would allow the company to be acquired by a consortium of investors. The nature of the dispute was whether the scheme met the necessary legal criteria for approval, considering the interests of the company's shareholders and creditors.

The court was tasked with determining whether the scheme of arrangement proposed by the consortium complied with the statutory requirements under the Corporations Act. Key issues included the fairness of the scheme to all stakeholders, including minority shareholders, and whether the necessary approvals had been obtained. The court had to consider the adequacy of the information provided to shareholders, the transparency of the process, and whether the scheme was likely to benefit the company and its stakeholders in the long term.

The court found that the formal requirements for the scheme had been satisfied, including the necessary approvals from the company's board and the requisite shareholder majorities. The court concluded that the scheme was fair and reasonable for all stakeholders, taking into account the valuation reports, the benefits to the company, and the protection of minority shareholders' interests. The court approved the scheme of arrangement, finding it to be in the best interests of the company and its stakeholders. The court's decision was based on the comprehensive analysis of the scheme's provisions and the assurances provided by the consortium regarding the protection of all stakeholders' interests.

The court issued orders approving the scheme of arrangement, allowing the acquisition of Coca-Cola Amatil Limited by the consortium of investors to proceed. The orders were made under the authority of section 411 of the Corporations Act, confirming the court's approval of the scheme and its compliance with all necessary legal requirements.

Orders