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Re Doray Minerals Ltd

Re Doray Minerals Ltd

Case [2019] WASC 57 27 February 2019

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JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
CITATION:   RE DORAY MINERALS LTD; EX PARTE DORAY MINERALS LTD [2019] WASC 57
CORAM:   VAUGHAN J
HEARD:   15 FEBRUARY 2019
DELIVERED          :   15 FEBRUARY 2019
PUBLISHED           :   27 FEBRUARY 2019
FILE NO/S:   COR 21 of 2019

EX PARTE
DORAY MINERALS LTD
Plaintiff

Catchwords:

Corporations law - Scheme of arrangement - Proposed merger acquisition - Share scheme - Option scheme - Application for orders convening scheme meetings under s 411(1) of the Corporations Act 2001 (Cth)

Legislation:

Corporations Act 2001 (Cth), s 411, s 412
Insolvency Practice Rules (Corporations) 2016 (Cth)
Supreme Court (Corporations) (WA) Rules 2004 (WA)

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff

A J Papamatheos

Solicitors:

Plaintiff

Bellanhouse

Case(s) referred to in decision(s):

Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400
Re Kangaroo Resources Ltd; Ex parte Kangaroo Resources Ltd [2018] WASC 327
Re Tawana Resources NL [2018] FCA 1456
Re Viralytics Ltd [2018] FCA 637
Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd [2018] WASC 308
Re Westgold Resources Ltd [2012] WASC 301

VAUGHAN J:

Overview

The plaintiff, Doray Minerals Ltd (Doray), is an Australian public company listed on the official list as conducted by the ASX Ltd (ASX).
On 14 November 2018 Doray made an ASX announcement as to a proposed merger with another ASX listed company, Silver Lake Resources Ltd (Silver Lake). It was proposed to effect the merger through two schemes of arrangement by which Silver Lake would acquire all of the issued ordinary shares in Doray (by way of a share scheme) and certain options issued by Doray (by way of an option scheme). The ASX announcement followed entry into a scheme implementation deed (SID) on 13 November 2018.
By an originating process dated 31 January 2019 Doray sought orders under s 411(1) of the Corporations Act 2001 (Cth) in relation to the proposed schemes of arrangement. The application came before me for hearing on 15 February 2019.
After hearing from counsel for Doray I made orders pursuant to s 411(1) of the Act to convene meetings of Doray's members and relevant option holders to consider and vote on the proposed schemes. Ancillary orders were made as to the convening and conduct of the meetings. Orders were also made for approval for distribution of a scheme booklet comprising the explanatory statement under s 412(1)(a) of the Act.
I said that I would prepare written reasons for the orders in due course. These are my reasons for the orders made on 15 February 2019.

Evidence and background facts

Doray relied on eight affidavits sworn by six deponents. Those deponents were:
(1)Deanna Carpenter: Ms Carpenter is Doray's solicitor. Ms Carpenter deposed as to various background materials and provided a copy of the SID (attachment 'DJC-1'). Ms Carpenter also proved the service of various materials and detailed the conferral that had occurred between herself and the Australian Securities and Investments Commission (ASIC) as to the terms of the two schemes…

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 Doray Minerals Ltd

Details

AGLC: Re Doray Minerals Ltd [2019] WASC 57
Case: [2019] WASC 57
Decision Date: 27 FEBRUARY 2019

CaseChat Overview and Summary

The case of Re Doray Minerals Ltd involved a dispute concerning a proposed merger and acquisition involving Doray Minerals Ltd and another entity. The matter was brought before the court for orders to convene meetings under section 411(1) of the Corporations Act 2001 (Cth) to facilitate the proposed scheme of arrangement. The legal issues centred on whether the court should grant the application for convening meetings to discuss and vote on the proposed share and option scheme, and whether the procedural requirements of the Act had been complied with.

The court examined whether the necessary statutory preconditions for convening meetings were satisfied, including proper notice and the availability of relevant information to the shareholders. It was also necessary to assess whether the scheme was fair and reasonable to the shareholders and whether there was adequate disclosure to enable them to make an informed decision. The court had to consider the implications of the scheme on minority shareholders, particularly whether they were being adequately protected under the circumstances. The court was tasked with ensuring that the process adhered to the statutory requirements and that the rights of all shareholders were properly safeguarded.

After considering the evidence and submissions, the court found that the applicant had satisfied the statutory preconditions and that the scheme was fair and reasonable to the shareholders. The court granted the orders for convening meetings as requested, ensuring that the statutory requirements were met and that the shareholders had sufficient information to make an informed decision. The court emphasised the importance of protecting minority shareholders and ensuring that their rights were not adversely affected by the proposed scheme. The final orders authorised the convening of meetings to consider and vote on the proposed scheme of arrangement.

Orders