Re Gold Road Resources Ltd
[2025] WASC 327
•15 AUGUST 2025
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: RE GOLD ROAD RESOURCES LTD; EX PARTE GOLD ROAD RESOURCES LTD [2025] WASC 327
CORAM: HILL J
HEARD: 14 AUGUST 2025
DELIVERED : 14 AUGUST 2025
PUBLISHED : 15 AUGUST 2025
FILE NO/S: COR 114 of 2025
MATTER: IN THE MATTER OF GOLD ROAD RESOURCES LTD
EX PARTE
GOLD ROAD RESOURCES LTD
Plaintiff
GRUYERE HOLDINGS PTY LTD
Interested Party
Catchwords:
Corporations law - Scheme of arrangement - Application for orders convening scheme meeting under s 411(1) of the Corporations Act 2001 (Cth) - Independent expert of opinion that proposed scheme is fair and reasonable - Voting intention statements from major shareholders in favour of proposed scheme - Whether requirements to order scheme meeting are satisfied - Orders made convening scheme meeting
Legislation:
Corporations Act 2001 (Cth) s 411, s 412, s 1319
Corporations Regulations 2001 (Cth) sch 8
Supreme Court (Corporations) (WA) Rules 2004 (WA) r 3.2
Result:
Orders made convening scheme meeting
Category: B
Representation:
Counsel:
| Plaintiff | : | J Taylor SC |
| Interested Party | : | J Sippe |
Solicitors:
| Plaintiff | : | Corrs Chambers Westgarth |
| Interested Party | : | Herbert Smith Freehills Kramer |
Cases referred to in decision:
Re Amcom Telecommunications Ltd [2015] FCA 341
Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400
Re Azure Minerals Ltd [2024] WASC 58
Re CSR Ltd [2010] FCAFC 34; (2010) 183 FCR 358
Re Kangaroo Resources Ltd [2018] WASC 327
Re Pacific Energy Limited [2019] WASC 443
Re SRG Ltd [2018] FCA 1092
Re Wesfarmers Ltd [2018] WASC 308
HILL J:
Gold Road Resources Limited (Gold Road) is an Australian company listed on the Australian Securities Exchange (ASX).[1] On 5 May 2025, Gold Road announced it had entered into a Scheme Implementation Deed (SID) with Gruyere Holdings Pty Ltd (Gruyere), a wholly owned subsidiary of Gold Fields Limited (Gold Fields), for the acquisition of all of Gold Road's shares (Scheme). Gruyere's obligations under the SID are guaranteed by Gold Fields Holding Company Limited (GFHC).[2] Since that date, the parties have agreed to amend the terms of the proposed Scheme.[3]
[1] Affidavit of Katrina Anne Sleiman filed 29 July 2025 [4].
[2] Affidavit of Katrina Anne Sleiman filed 29 July 2025 [6], 'KAS-2'.
[3] Affidavit of Katrina Anne Sleiman filed 29 July 2025 [7], 'KAS-3'.
The originating process dated 29 July 2025 came before me for the first court hearing on 14 August 2025. On that date, I ordered that a meeting of Gold Road's shareholders be convened to consider and vote on the proposed Scheme (Scheme Meeting). Orders were also made approving the distribution of a Scheme booklet, and for the conduct of the Scheme Meeting.
In making those orders, I stated that I would subsequently publish written reasons for the orders I made. These are those reasons.
Nature of proposed scheme
Gold Road is a mid-tier Australian gold producer, developer, and explorer based in Perth, Western Australia. It holds a 50% interest in the Gruyere gold mine in Western Australia, which has been developed as a joint venture with Gold Fields, a 100% interest in the Yamarna gold project, as well as interests in other projects in Western Australia, South Australia, and Queensland.[4] Gold Road has a market capitalisation of more than $3.5 billion and as at 7 August 2025, had the following securities on issue: [5]
(a)1,086,399,060 fully paid ordinary shares (Shares); and
(b)6,439,485 performance rights (Performance Rights).
[4] Affidavit of Julie Jones filed 7 August 2025 [8] - [11].
[5] Affidavit of Julie Jones filed 7 August 2025 [16].
Gruyere is a wholly owned subsidiary of Gold Fields and holds Gold Fields' 50% interest in the Gruyere gold mine joint venture with Gold Road. Gold Fields is a globally diversified gold producer based in Johannesburg, South Africa, whose shares are listed on the Johannesburg Stock Exchange and the New York Stock Exchange. It has interests in nine operating mines in Australia, Chile, Ghana, Peru, and South Africa, and one major development project in Canada.[6]
[6] Scheme booklet [6.2(a)].
If the Scheme is implemented, Shareholders will receive: [7]
(a)a fixed cash component of $2.52 for every Share held at the Record Date (Fixed Cash Consideration); and
(b)a variable cash component which equates to each Shareholder's pro rata proportion of the value of Gold Road's shareholding in Northern Star Resources Limited (Northern Star), determined by the volume weighted average price of Northern Star's shares traded on the (ASX) during the five trading days immediately prior to the date that the Scheme becomes effective (Variable Cash Consideration);
(together, Scheme Consideration).
[7] SID, Schedule 1 (definition of Scheme Consideration).
As at 8 August 2025, the Scheme Consideration equated to $3.29 per Share.
If the Scheme is implemented, Gold Road intends to declare a fully franked special dividend (Special Dividend) based on the balance of its franking account at the relevant date the dividend is declared. Based on Gold Road's franking account balance as at 8 August 2025, the Special Dividend would equate to approximately $0.40 per share and, if declared and paid, distribute up to approximately $0.17 in franking credits per Share.[8] If the Special Dividend is declared and paid, the amount of the Fixed Cash Consideration will be reduced by the amount of the Special Dividend.
[8] Scheme booklet [1.2], [3.7], [8].
Under the SID, Gold Road is required to ensure all Performance Rights vest or lapse in accordance with their terms and convert into Shares prior to the Record Date.[9]
[9] SID, cl 4.4; Scheme booklet [10.4].
Shareholders whose address is outside of Australia or New Zealand are able under the Scheme to elect to receive the Scheme Consideration in their local (or a nominated) currency.[10]
[10] Scheme cl 6.1(e)(1).
The independent directors of Gold Road have unanimously recommended that, in the absence of a superior proposal, Shareholders vote in favour of the Scheme.
Gold Road retained an independent expert, Deloitte Corporate Finance Pty Ltd (Deloitte), to provide an opinion on the proposed Scheme. Deloitte concluded that, in the absence of a superior proposal, the proposed Scheme is fair and reasonable and is in the best interests of Shareholders.[11] In reaching this conclusion, Deloitte compared the value of a Share prior to the Scheme compared to the value of the Scheme Consideration. Deloitte assessed the value of a Share to be between $2.80 and $3.28 per Share. This was slightly lower than their assessment of the value of the Scheme Consideration of $3.29 per Share.[12] The basis for the valuation and the methodology used are set out in the IER. The consideration of advantages, disadvantages, and other factors that are likely to impact shareholders are set out comprehensively in the IER.
[11] Scheme booklet, Appendix 1.
[12] Scheme booklet, Appendix 1.
The Scheme will not be implemented unless and until a number of conditions precedent are satisfied or waived. The conditions precedent which are required to be satisfied or waived are contained in the SID,[13] and summarised in the Scheme booklet.[14]
[13] SID, cl 3.1.
[14] Scheme booklet [9.2].
The obligations of Gruyere and GFHC under the Scheme are supported by a deed poll.[15]
[15] Affidavit of Katrina Anne Sleiman filed 13 August 2025, 'KAS-4'.
Legal principles in respect of the Scheme
Pursuant to s 411 of the Act, a scheme of arrangement can be used to re-organise a company which is binding on members where:
(a)the arrangement is agreed by the requisite majorities prescribed by s 411(4)(a) of the Act, namely, 75% of shareholders by value and 50% by number; and
(b)the court approves the arrangement pursuant to s 411(4)(b) of the Act.
There are three stages to an application under s 411 of the Act. First, the court approves the convening of a scheme meeting. Second, the members vote on the proposed scheme at the scheme meeting. Third, assuming the first two stages have occurred, the court approves the proposed scheme.[16]
[16] Re CSR Ltd [2010] FCAFC 34; (2010) 183 FCR 358 [7].
There are well‑established principles that apply to each stage. In relation to the first court hearing, the court will order the scheme meeting to be convened if it is satisfied that:[17]
(a)there is a pt 5.1 body;
(b)there is a compromise or arrangement within the meaning of s 411 of the Act;
(c)the proposed scheme booklet contains the prescribed information[18] and provides proper disclosure;[19]
(d)the scheme is bona fide and properly proposed;
(e)the Australian Securities and Investments Commission (ASIC) has had at least 14 days' notice of the proposed hearing date and a reasonable opportunity to examine the terms of the scheme and the scheme booklet and make submissions;[20]
(f)the procedural requirements of the Act and the Supreme Court (Corporations) (WA) Rules 2004 (WA) (Corporations Rules) have been met; and
(g)the scheme is of such a nature that, if it receives the necessary statutory majority at the scheme meeting, the court will be likely to approve it.
[17] Re SRG Ltd [2018] FCA 1092 [11]; Re Wesfarmers Ltd [2018] WASC 308 [60].
[18] Corporations Act 2001 (Cth) s 412(1)(a)(ii); Corporations Regulations 2001 (Cth) reg 5.1.01, sch 8 cl 8301 ‑ 8310.
[19] Corporations Act 2001 (Cth) s 412(1)(a)(i).
[20] Corporations Act 2001 (Cth) s 411(2)(b).
The standard of review that is undertaken by the court at the first hearing is whether the proposed scheme is not inappropriate and is one that sensible businesspeople might consider is of benefit to its members.[21] If the proposed arrangement is one that appears fit for consideration by a meeting of members and is a commercial proposition likely to gain the court's approval if passed by the necessary majority, leave should be given to convene the meeting.[22]
Should orders be made for the convening of the Scheme Meeting and the dispatch of the Scheme booklet?
[21] Re Amcom Telecommunications Ltd [2015] FCA 341 [10].
[22] Re SRG Ltd [12]; Re Wesfarmers Ltd [72] - [76].
At the first court hearing, Gold Road relied on five affidavits being:
(a)three affidavits of Katrina Anne Sleiman, a partner of Corrs Chambers Westgarth, the solicitors for Gold Road, filed 29 July, 13, and 14 August 2025;
(b)an affidavit of Julie Jones, Gold Road's general counsel and joint company secretary, filed 7 August 2025; and
(c)an affidavit of Alan James Gibson, Vice President - Legal of Gold Fields filed 12 August 2025.
These affidavits prove the formal matters that Gold Road is required to establish.
On the materials before me, there was nothing to suggest that the Scheme was not properly proposed.
There are a number of conditions precedent to the Scheme.[23] Neither Gold Road nor Gruyere has any basis to believe that any of these conditions precedent will not be satisfied or waived prior to implementation of the Scheme.[24]
Disclosure and Scheme booklet
[23] SID, cl 3.1.
[24] Affidavit of Julie Jones filed 7 August 2025 [84]; Affidavit of Alan James Gibson filed 12 August 2025 [32].
I was provided with a copy of the draft Scheme booklet,[25] as well as the final Scheme booklet which incorporated changes addressing ASIC's comments.[26]
[25] Affidavit of Julie Jones filed 7 August 2025, 'JJ-1'.
[26] Affidavit of Katrina Anne Sleiman filed 13 August 2025, 'KAS-6'.
I was and am satisfied that there will be proper disclosure as to the effect of the proposed Scheme and the material considerations for Shareholders.
There is evidence before me as to the due diligence and verification process undertaken by both Gold Road and Gruyere.[27] I accept that Gold Road and Gruyere have undertaken processes to verify the accuracy of statements attributable to each of them in the Scheme booklet and to ensure that the Scheme booklet does not omit any material information.
[27] Affidavit of Julie Jones filed 7 August 2025 [32] - [49]; Affidavit of Alan James Gibson filed 12 August 2025 [13] - [27].
Based on the checklist provided by counsel for Gold Road,[28] I was satisfied the Scheme booklet contained the prescribed information in accordance with s 412(1)(a)(ii) of the Act and sch 8 of the Corporations Regulations 2001 (Cth).
Performance risk
[28] Plaintiff's submissions 19 - 22.
On the evidence before the court, I was and am satisfied that Shareholders are adequately protected against any performance risk.
Under the terms of the Scheme:[29]
(a)On the date prior to the implementation of the Scheme, Gruyere must deposit in cleared funds the aggregate amount of the Scheme Consideration in an Australian dollar denominated trust account with an ADI operated by Gold Roads as trustee for the Shareholders;
(b)transfer of the Shares is subject to provision of the Scheme Consideration; and
(c)beneficial title does not pass unless the Scheme Consideration has been issued in accordance with the Scheme.
[29] Scheme, cl 5.2, 6.1, 7.2.
These arrangements are supported by the Deed Poll,[30] which can be enforced by any Shareholder.[31]
Exclusivity provisions and exclusivity fee
[30] Deed Poll, cl 5.
[31] Deed Poll, cl 2.
The SID contains the customary lock-up devices (including, where usual, the fiduciary carve-out).[32] If these provisions are breached, Gold Road will be obliged to pay a reimbursement fee of $37.1 million (Reimbursement Fee) to Gruyere.[33]
[32] SID, cl 11.
[33] SID, cl 12.2 - 12.3.
In considering whether the exclusivity provisions impact on completion of the transaction and the duties of directors, the court has regard to: [34]
(a)the period of the exclusivity, which should be no more than a reasonable period and capable of precise ascertainment;
(b)whether the provisions are subject to an overriding obligation that the directors do not breach their fiduciary duties or are otherwise unlawful; and
(c)whether there is adequate prominence given to these provisions in the Scheme booklet.
[34] Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400 [29] - [35]; Re Kangaroo Resources Ltd [2018] WASC 327 [57] - [61]; RePacific Energy Limited [2019] WASC 443 [58].
In this case, the exclusivity period is, at most, a period of approximately eight months. The exclusivity provisions are subject to appropriate fiduciary carve-outs.
During the commercial negotiations of the SID, all parties were separately advised,[35] and the commercial justification for the exclusivity provisions have been explained.[36]
[35] Affidavit of Julie Jones filed 7 August 2025 [73].
[36] Affidavit of Julie Jones filed 7 August 2025 [75] - [82].
The amount of the Reimbursement Fee is less than 1% of the equity value of Gold Road, based on the value of the Consideration as at 2 May 2025, being the last day of trading of Shares on the ASX prior to the announcement of the Scheme. This is within generally accepted commercial parameters and in accordance with 'Guidance Note 7 - Lock-up devices' of the Takeovers Panel. The Reimbursement Fee is intended to compensate Gold Field for its costs if the Scheme does not proceed. The Reimbursement Fee is not payable if Shareholders do not vote in favour of the Scheme. In my view, the amount of the Reimbursement Fee is unlikely to influence Shareholders in their decision to vote on the Scheme.
Importantly, the exclusivity arrangements and Reimbursement Fee are disclosed in the Scheme booklet.[37]
Directors' benefits and recommendations
[37] Scheme booklet [9.5].
Gold Road's directors have recommended that, in the absence of a superior proposal and subject to Deloitte continuing to conclude the Scheme is in the best interests of Shareholders, Shareholders vote in favour of the Scheme.
Gold Road drew my attention to the fact that each of its directors have interests in Shares and are currently receiving an additional monthly payment as remuneration for their additional duties in relation to the implementation of the Scheme. Mr Duncan Gibbs, the managing director and chief executive officer of Gold Road, also has an interest in Performance Rights. Mr Gibbs will also receive a cash payment under Gold Road's employee incentive scheme of approximately $427,000 if the Scheme is implemented,[38] and may be entitled to a termination payment in the event his employment is terminated, if the Scheme is implemented.
[38] Scheme booklet [10.1] - [10.3].
Each of the directors considered whether they should make a recommendation on the Scheme to Shareholders and believed it was appropriate to do so, given the importance of the proposed Scheme.[39]
[39] Affidavit of Julie Jones filed 7 August 2025 [55] - [63].
For three primary reasons, I accept that it is appropriate for the directors to make a recommendation in respect of the Scheme.
First, the consideration that each director will receive for their Shares (and, where applicable, Performance Rights, which will convert to Shares prior to the Scheme Record Date if the Scheme is implemented) is the same consideration that every other Shareholder of Gold Road will receive
Second, the obligation to make the payments to Mr Gibbs under the employment incentive scheme, as well as any termination payment, arose under arrangements entered into before the Scheme was proposed. These payments are not being made as an incentive to promote the Scheme or to ensure his support of the Scheme.
Third, and importantly, the Scheme booklet sets out in detail each of the directors' interests and benefits that they will receive under the Scheme.[40] These interests are fully disclosed to Shareholders, who can assess the recommendations made by the directors in the context of that disclosure.
Shareholder voting intention statements
[40] Scheme booklet [10.3] - [10.4].
The Scheme booklet also disclosed that Gold Road has received voting intention statements from four of its major shareholders, who, as at 5 May 2025, collectively held 7.5% of the Shares on issue. These Shareholders have confirmed that they intend to vote in favour of the proposed Scheme, in the absence of a superior proposal and subject to Deloitte continuing to conclude that the Scheme is in the best interests of Shareholders.[41]
[41] Scheme booklet [10.8].
I was and am satisfied that these statements are appropriately disclosed in the Scheme booklet, consistent with both the Takeovers Panel Guidance Note 23: Shareholder Intention Statements, and previous authorities.[42]
Deemed warranties and no encumbrances
[42] See Re Azure Minerals Ltd [2024] WASC 58 [66].
Gold Road also drew my attention to the deemed warranty and no encumbrance provisions in the proposed Scheme.[43] These clauses are not unusual and are acceptable provided there is adequate disclosure.
[43] Scheme cl 9.2.
These provisions are drawn to the attention of Shareholders in the Scheme booklet.[44] I was and am satisfied that adequate disclosure has been given of these clauses.
Proposed Shareholder communications
[44] Scheme booklet [1.4(c)], [2], [3.6].
Gold Road drew my attention to the steps it proposes to take in terms of Shareholder communications. This will include inbound telephone communications, as well as engagement with proxy advisers.
I was provided with a draft script of the proposed telephone communications. The communications are consistent with the disclosure in the Scheme booklet, in respect of which approval is sought. In relation to the engagement with major proxy advisers, Gold Road proposes that Sodali & Co Pty Ltd facilitate this process using a PowerPoint presentation. It is not intended that these materials will go beyond the information contained in the Scheme booklet.[45] Gold Road will provide a report to the court at the second court hearing, consistent with the approach taken in respect of shareholder communication.
Dispatch of the Scheme booklet
[45] Second affidavit of Katrina Anne Sleiman file 13 August, 2025 'KAS-5'.
Gold Road sought orders pursuant to s 1319 of the Act for electronic dispatch of the Scheme booklet and applicable proxy forms by email to securityholders who have nominated to receive communications electronically (Email Shareholders). In respect of Shareholders who have nominated to receive communications in hardcopy, hardcopy documents will be dispatched by post.
Shareholders who have not made any election, as well as those Email Shareholders in respect of whom notice is received that electronic delivery was ineffective, will be sent a letter with details of the website from which the Scheme booklet can be accessed, together with a copy of the applicable proxy form.
I was and am satisfied that the proposed orders for dispatch of the Scheme booklet are appropriate.
Conclusion and orders
At the first hearing before me, I was satisfied that the substantive and procedural requirements under s 411(1) and s 1319 of the Act had been satisfied and that the proposed Scheme was fit for consideration by Gold Road's shareholders. On this basis, at the conclusion of the hearing on 14 August 2025, I made orders in terms of Annexure 'A' to this judgment in respect of the Scheme.
Annexure 'A'
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
KS
Associate to the Honourable Justice Hill
15 AUGUST 2025
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