Re Facilitate Digital Holdings Limited (No.2)

The case of Re Facilitate Digital Holdings Limited (No.2) involves the applicant company seeking approval of a scheme of arrangement under section 411 of the Corporations Act 2001. The scheme proposes that the shares of the applicant company be acquired by another company, with the exchange ratio being 1.216 shares in the acquiring company for each share in the applicant company. The application was heard in the Federal Court of Australia, where the central legal issue was whether the court should exercise its discretion to approve the proposed scheme of arrangement.

The court examined the fairness and reasonableness of the scheme to the shareholders of the applicant company. In assessing the fairness, the court considered the merits of the proposal, the value of the shares in the context of the market, and the terms of the arrangement. The court also considered whether the scheme provided for an equitable treatment of all shareholders, including minority shareholders. The court needed to determine if the scheme was fair and reasonable, and whether it met the statutory requirements for approval.

In its decision, the court found that the scheme was fair and reasonable to the applicant's shareholders and met the statutory requirements for approval. The court was satisfied that the exchange ratio was fair, and the scheme provided for an equitable treatment of all shareholders. The court exercised its discretion under section 411(4) of the Corporations Act to approve the scheme of arrangement. The court also exempted the applicant from compliance with section 411(11) of the Act in relation to this order, and ordered the applicant to lodge a copy of the orders with the Australian Securities and Investments Commission.

The final orders of the court approved the scheme of arrangement between the applicant and its shareholders, exempted the applicant from compliance with certain statutory requirements, and mandated the applicant to lodge a copy of the orders with the Australian Securities and Investments Commission. This decision underscores the court's role in ensuring that schemes of arrangement are fair and equitable to all shareholders, while also recognising the statutory framework within which such schemes must operate.