Re Foster's Group Limited

[2011] VSC 93

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT

No. LIST E
S CI 2011  00930

IN THE MATTER OF FOSTER’S GROUP LIMITED (ACN 007 620 886)

FOSTER’S GROUP LIMITED (ACN 007 620 886) Plaintiff

JUDGE:	FERGUSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	17 March 2011
DATE OF JUDGMENT:	21 March 2011
CASE MAY BE CITED AS:	Re Foster’s Group Limited
MEDIUM NEUTRAL CITATION:	[2011] VSC  93

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CORPORATIONS – Scheme of Arrangement – Orders convening first meeting – Demerger of part of business – Whether partly paid or overseas shareholders constitute separate class - s 411 Corporations Act 2001 (Cth)

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A C Archibald QC with Mr G Ahern	Corrs Chambers Westgarth

HER HONOUR:

Introduction

1. Foster’s Group Limited (“Foster’s”) is a brewer, winemaker, distiller, marketer and distributor of beer, wines, spirits and ciders with a portfolio of over 100 brands and operations in five continents.  It is a listed company on the official list of ASX Limited.  The wine business of Foster’s is conducted through Treasury Wine Estates Limited.  The shares in Treasury Wine Estates are held by a Foster’s subsidiary, Foster’s Australia Limited (“Foster’s Australia”).

1. Foster’s proposes to demerge Treasury Wine Estates from the existing corporate structure of the Foster’s group. In this way, the wine business will be separated from the rest of Foster’s business. Foster’s proposes to effect the demerger by a reduction of its share capital and the implementation of a proposed scheme of arrangement under s411 of the Corporations Act 2001 (Cth). Under the proposed scheme, subject to some exceptions which I mention below, the holders of shares in Foster’s (whether they be fully paid or partly paid) will receive one ordinary share in Treasury Wine Estates for each three shares that they hold in Foster’s. It is intended that Treasury Wine Estates will be listed on the official list of ASX following the demerger.

1. Foster’s sought orders under s411(1) of the Corporations Act for the convening of a meeting of its shareholders for the purpose of voting on the proposed scheme.  I made those orders on 17 March 2010.  These are my reasons for making them.

The documents

1. Foster’s and Treasury Wine Estates have entered into an Implementation Deed under which they agree to take all the necessary steps required to implement the proposed scheme and the capital reduction to bring about the demerger.  In addition, by a deed poll in favour of the Foster’s shareholders participating in the scheme, Treasury Wine Estates will be bound to perform its obligations under the Implementation Deed and the proposed scheme.

1. Foster’s and Foster’s Australia have entered into a Transfer Agreement under which Foster’s has agreed to pay to Foster’s Australia the capital reduction amount (which I refer to below) in consideration of Foster’s Australia transferring the Treasury Wine Estates shares to the eligible Foster’s shareholders under the scheme. 

Outline of the demerger and how it is to be effected

1. The…