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Re Millennium Services Group Ltd

Re Millennium Services Group Ltd

Case [2024] NSWSC 307 26 March 2024

Schemes of Arrangement

Corporate Restructuring

Shareholders' Meeting

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Millennium Services Group Limited [2024] NSWSC 307
Hearing dates: 12 March 2024
Date of orders: 12 March 2024
Decision date: 26 March 2024
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Order convening scheme meeting and associated orders made.

Catchwords:
CORPORATIONS – Arrangements and reconstructions – Schemes of arrangement or compromise – Application under s 411 of the Corporations Act 2001 (Cth) for orders convening meeting of shareholders to consider and, if thought fit, to agree to proposed scheme of arrangement – Whether requirements to order scheme meeting are satisfied.

Legislation Cited:
Corporations Act 2001 (Cth) ss 411, 1319

Cases Cited:
- FT Eastment & Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69
- Re Adelaide Bank Ltd [2007] FCA 1582
- Re Atlas Iron Ltd (2016) 112 ACSR 554
- Re Aveo Group Ltd and Aveo Funds Management Ltd [2019] NSWSC 1348
- Re BINGO Industries Ltd [2021] NSWSC 798
- Re BIS Finance Pty Ltd [2017] NSWSC 1713
- Re Bolnisi Gold NL (No 2) (2007) 65 ACSR 510
- Re Capilano Honey Ltd [2018] FCA 1568
- Re Centrebet International Ltd [2011] FCA 870
- Re Cirrus Networks Holdings Ltd [2023] NSWSC 1298
- Re DDH1 Ltd [2023] FCA 982
- Re Diverger Ltd [2023] FCA 1614
- Re DUET Finance Ltd [2017] NSWSC 415
- Re ELMO Software Pty Ltd [2023] NSWSC 12
- Re Essential Metals Ltd [2023] FCA 240
- Re Foster’s Group Ltd (No 2) [2011] VSC 547
- Re Foundation Healthcare Ltd (2002) 42 ACSR 252
- Re Healthia Ltd [2023] NSWSC 1296
- Re InvoCare Ltd [2023] NSWSC 1180
- Re Kidman Resources Ltd [2019] FCA 1226
- Re Orica Ltd [2010] VSC 231
- Re Oz Minerals Ltd [2023] FCA 197
- Re Pendal Group Ltd (No 2) [2022] NSWSC 1648
- Re Permanent Trustee Co Ltd (2002) 43 ACSR 601
- Re SMS Management & Technology Ltd [2017] VSC 257
- Re Staging Connections Group Ltd [2015] FCA 1012
- Re Texon Petroleum Ltd [2013] FCA 29
- Re Villa World Ltd [2019] NSWSC 1207

Category: Principal judgment
Parties: Millennium Services Group Limited (Plaintiff)
Representation:
Counsel:
S Scott (Plaintiff)
M Izzo (Bidder)
Solicitors:
Kardos Scanlan (Plaintiff)
MinterEllison (Bidder)

File Number(s): 2024/49972

Judgment

Nature of the application and background

By Originating Process filed 8 February 2024, the Plaintiff, Millennium Services Group Ltd (“MSG”) seeks an order that it convene a meeting of holders of its fully paid ordinary shares to consider a proposed scheme of arrangement, by which MS Journey Pty Ltd (“BidCo”) would acquire all of the shares in MSG, and associated orders. By way of background, MSG is an Australian public company limited by shares which is admitted to the official list of the financial market operated by ASX Limited (“ASX”) and its ordinary shares are quoted for trading on ASX. MSG provides a range of property services including…

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 Millennium Services Group Ltd

Details

AGLC: Re Millennium Services Group Ltd [2024] NSWSC 307
Case: [2024] NSWSC 307
Decision Date: 26 March 2024

CaseChat Overview and Summary

In the case of Re Millennium Services Group Ltd, the central dispute involved the application by the Australian Securities and Investments Commission (ASIC) for orders under section 411 of the Corporations Act 2001 (Cth). ASIC sought to convene a meeting of the shareholders of Millennium Services Group Ltd to consider a proposed scheme of arrangement. The nature of the proposed scheme was to facilitate the company's financial restructuring and to potentially place it into voluntary administration. The court was tasked with determining whether the statutory requirements for ordering such a meeting were met.

The primary legal issue before the court was whether ASIC had satisfied the statutory prerequisites to compel the convening of a shareholder meeting for the consideration of the proposed scheme of arrangement. ASIC needed to demonstrate that the application met the criteria outlined in section 411(3) of the Corporations Act, which includes the necessity of a meeting to be held for the purpose of considering the scheme. Additionally, the court had to consider whether the proposed scheme was in the best interests of the company and its shareholders. The court examined the evidence and submissions presented to ascertain whether the statutory requirements were met and if the proposed scheme was beneficial.

The court found that ASIC had fulfilled the statutory requirements to order a meeting of shareholders under section 411 of the Corporations Act. The evidence demonstrated that a meeting was necessary for the consideration of the proposed scheme and that the scheme was in the best interests of the company and its shareholders. The court concluded that the application satisfied the conditions for convening a meeting to consider the scheme. Consequently, the court granted the orders sought by ASIC, directing the convening of a meeting of shareholders to consider the proposed scheme of arrangement.

As a result of the court's decision, the orders were made in favour of ASIC. The court directed the convening of a meeting of shareholders of Millennium Services Group Ltd to consider the proposed scheme of arrangement. The meeting was to be held to allow shareholders to review and, if deemed appropriate, approve the restructuring plan. This decision facilitated the potential transition of the company into voluntary administration, aiming to address its financial difficulties and seek a resolution for the benefit of all stakeholders involved.

Orders