Re Poseidon Nickel Ltd - [2024] WASC 516

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE POSEIDON NICKEL LTD; EX PARTE POSEIDON NICKEL LTD [2024] WASC 516
CORAM:   HILL J
HEARD:   23 DECEMBER 2024 & 7 FEBRUARY 2025
DELIVERED          :   23 DECEMBER 2024 & 7 FEBRUARY 2025
PUBLISHED           :   10 FEBRUARY 2025
FILE NO/S:   COR 181 of 2024
MATTER:   IN THE MATTER OF POSEIDON NICKEL LTD

EX PARTE
POSEIDON NICKEL LTD
Plaintiff

Catchwords:

Corporations - Two inter-conditional schemes of arrangement - Application for orders convening scheme meetings under s 411(1) of Corporations Act 2001 (Cth) - Independent expert of opinion that proposed schemes are not fair but reasonable and in best interests of securityholders - Whether requirements to order scheme meetings are satisfied - Orders made convening scheme meetings

Corporations - Schemes of arrangement - Whether supplementary disclosure required by plaintiff in relation to announcements made by bidder - Announcements did not alter opinion of independent expert - No impact on schemes

Corporations - Schemes of arrangement - Application for orders approving schemes under s 411(4)(b) of the Corporations Act 2001 (Cth) - Orders made approving schemes

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 meetings
Orders made approving schemes

Category: B

Representation:

Counsel:

Plaintiff

Mr J Healey

Solicitors:

Plaintiff

Steinepreis Paganin

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 Beadell Resources Ltd [2018] WASC 410; (2018) 133 ACSR 600
Re CSR Ltd [2010] FCAFC 34; (2010) 183 FCR 358
Re International Goldfields Ltd [2004] WASC 112
Re Kangaroo Resources Ltd [2018] WASC 327
Re Nzuri Copper Ltd [2019] WASC 189
Re Pacific Energy Limited [2019] WASC 443
Re Schrole Group Ltd [2024] WASC 515
Re Seven Network Ltd [No 3] [2010] FCA 400; (2010) 267 ALR 583
Re SRG Ltd [2018] FCA 1092
Re TASK Group Holdings Ltd [2024] NSWSC 821
Re Wesfarmers Ltd [2018] WASC 308
Re Wesfarmers Ltd [No 2] [2018] WASC 357

HILL J:

Poseidon Nickel Limited (Poseidon) is an Australian public company listed on the Australian Securities Exchange (ASX). On 25 October 2024, Poseidon announced it had entered into a Scheme Implementation Deed (SID) with Horizon Minerals Limited (Horizon) for the implementation of two inter‑conditional schemes.[1] Under the Schemes, it is proposed that Horizon will acquire all issued ordinary shares in Poseidon (Share Scheme), certain unlisted options in Poseidon will be cancelled (Option Scheme) (together, the Schemes), and Poseidon will become a wholly‑owned subsidiary of Horizon and be delisted from the ASX.
[1] Affidavit of Madeline Sky Ardon filed 11 December 2024 [8], 'MA-1'.
The originating process dated 18 November 2024 came before me for the first court hearing on 23 December 2024. On that date, I ordered the convening of a meeting of Poseidon's Shareholders and a separate meeting of Poseidon's…

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 Poseidon Nickel Ltd

Details

AGLC: Re Poseidon Nickel Ltd [2024] WASC 516
Case: [2024] WASC 516
Decision Date: 10 FEBRUARY 2025

CaseChat Overview and Summary

The case involved Poseidon Nickel Ltd, where two inter-conditional schemes of arrangement were proposed. The applicants sought orders convening scheme meetings under section 411(1) of the Corporations Act 2001 (Cth). The independent expert had concluded that while the schemes were not fair, they were reasonable and in the best interests of the securityholders. The court was tasked with determining whether the requirements to order the scheme meetings were satisfied.

The primary legal issue was whether the court should convene the scheme meetings given the independent expert's opinion that the schemes were not fair. The court examined the statutory framework and previous case law to assess the adequacy of the independent expert's report and the overall fairness of the schemes. The court found that despite the schemes not being fair, they were reasonable and in the best interests of the securityholders, satisfying the requirements for convening the scheme meetings. The court also considered whether supplementary disclosure was required in relation to announcements made by the bidder, concluding that such announcements did not alter the independent expert's opinion or impact the schemes.

The court ordered the convening of scheme meetings to allow securityholders to vote on the proposed schemes. Additionally, the court approved the schemes under section 411(4)(b) of the Corporations Act 2001 (Cth). The court's decision was grounded in the statutory provisions and the expert's assessment, ensuring that the processes were fair and in the best interests of the securityholders.

Orders