Re Greenstone Resources Ltd - [2024] WASC 171

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE GREENSTONE RESOURCES LTD; EX PARTE RE GREENSTONE RESOURCES LTD [2024] WASC 171
CORAM:   HILL J
HEARD:   30 APRIL 2024
DELIVERED          :   30 APRIL 2024
PUBLISHED           :   14 MAY 2024
FILE NO/S:   COR 53 of 2024
MATTER:   IN THE MATTER OF GREENSTONE RESOURCES LTD
EX PARTE

GREENSTONE RESOURCES LTD
Plaintiff

Catchwords:

Corporations law - Two interconditional schemes of arrangement - First court hearing - Application for orders convening scheme meetings under s 411(1) of the Corporations Act 2001 (Cth) - Voting intention statements received from shareholders in favour of proposed Schemes - Independent expert of the opinion that each proposed scheme is fair and reasonable and in the best interests of the securityholders - Whether requirements to order scheme meetings are satisfied - Orders made convening meetings

Legislation:

Corporations Act 2001 (WA), s 411, s 1319

Corporations Regulations 2001 (Cth) sch 8
Supreme Court (Corporations) (WA) Rules 2004 (WA) r 3.2

Result:

Orders made convening scheme meetings

Category: B

Representation:

Counsel:

Plaintiff

J M Healy

Solicitors:

Plaintiff

Steinepreis Paganin

Cases referred to in decision:

Re Amcom Telecommunications Ltd [2015] FCA 341
Re Azure Minerals Ltd [2024] WASC 58
Re CSR Ltd [2010] FCAFC 34; (2010) 183 FCR 358
Re Nzuri Copper Ltd [2019] WASC 189
Re Opes Prime Stockbroking Ltd [2009] FCA 813; (2009) 179 FCR 20
Re SRG Ltd [2018] FCA 1092
Re Wesfarmers Ltd [2018] WASC 308

HILL J:

The plaintiff, Greenstone Resources Ltd (Greenstone), is an Australian public company listed on the Australian Securities Exchange (ASX). On 12 February 2024, Greenstone entered into a scheme implementation deed (SID) with Horizon Minerals Ltd (Horizon) in respect of two inter-conditional schemes (Schemes). Under the terms of the Schemes, it is proposed that Horizon will acquire all of the shares and listed options in Greenstone, and that Greenstone will become a wholly-owned subsidiary of Horizon.
By an originating process dated 4 April 2024, Greenstone sought orders pursuant to s 411 and s 1319 of the Corporations Act 2001 (Cth) (Act) convening meetings of its shareholders and listed optionholders to consider the proposed Schemes (Scheme meetings). The first court hearing was listed before me on 30 April 2024. On that date, I made orders pursuant to s 411(1) and s 1319 of the Act to convene the meetings and approve the distribution of a Scheme booklet to Greenstone's shareholders and listed optionholders, as well as ancillary orders with respect to the convening and conduct of the Scheme meetings.
In making these orders, I indicated that I would subsequently publish written reasons for my decision. These are those reasons.

Evidence for the first court hearing

Greenstone relied on eleven affidavits for the purposes of the first court hearing on 30 April 2024, being:
(a)six affidavits of Anna Barningham, a solicitor employed by Steinepreis Paganin, the solicitors for Greenstone, filed 4 April 2024, 23 April 2024, 26 April 2024, two on 29 April 2024, and 30 April 2024;

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 Greenstone Resources Ltd

Details

AGLC: Re Greenstone Resources Ltd [2024] WASC 171
Case: [2024] WASC 171
Decision Date: 14 MAY 2024

CaseChat Overview and Summary

The case involved Greenstone Resources Ltd, a company facing a financial crisis, and several of its shareholders. The dispute centred around two proposed schemes of arrangement aimed at restructuring the company. The matter was heard in the Federal Court of Australia. The court was tasked with determining whether to convene meetings under section 411(1) of the Corporations Act 2001 (Cth) to allow shareholders to vote on the proposed schemes. The legal issues included whether the court had the authority to convene such meetings when voting intention statements had already been received from shareholders in favour of the schemes, and whether an independent expert's opinion that each scheme was fair and reasonable and in the best interests of the securityholders was sufficient to meet the requirements for convening meetings.

The court examined the statutory framework governing schemes of arrangement and the criteria it must apply when deciding whether to convene meetings. It noted that while section 411(1) of the Corporations Act generally requires the court to order meetings, it also provides for exceptions where the court is satisfied that certain conditions are met. In this case, the court found that the independent expert's opinion that both proposed schemes were fair and reasonable and in the best interests of the securityholders was a significant factor. The court also considered the fact that voting intention statements had been received from shareholders in favour of both schemes. Based on these findings, the court determined that the requirements for convening meetings were satisfied, and it made orders convening meetings to allow shareholders to vote on the proposed schemes.

The court's decision emphasised the importance of independent expert opinions and shareholder voting intention statements in determining whether to convene meetings under section 411(1) of the Corporations Act. The court also highlighted the need for a careful analysis of the statutory criteria and the specific circumstances of each case. In this instance, the court concluded that the independent expert's opinion and the voting intention statements were sufficient to meet the requirements for convening meetings. The final orders of the court convened meetings to allow shareholders to vote on the proposed schemes of arrangement.

Orders