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Re Prime Media Group Ltd

Re Prime Media Group Ltd

Case [2019] NSWSC 1888 22 December 2019

Schemes of Arrangement or Compromise

Disclosure

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Prime Media Group Limited [2019] NSWSC 1888
Hearing dates: 10 December 2019
Date of orders: 10 December 2019
Decision date: 22 December 2019
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Orders made approving supplementary disclosure for distribution.

Catchwords: CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – approval of supplementary disclosure.
Legislation Cited: - Corporations Act 2001 (Cth) Pt 5.1; ss 411, 1319
Cases Cited: - Re Amcom Telecommunications Ltd (No 2) [2015] FCA 410
- Re Billabong International Limited (No 2) [2018] FCA 496
- Re Centro Retail Ltd [2011] NSWSC 1321
- Re Citect Corporation Ltd [2006] NSWSC 143
- Re Investa Listed Funds Management Ltd [2016] NSWSC 344
- Re Investa Listed Funds Management Ltd [2016] NSWSC 369
- Re Seven Network Ltd (No 2) [2010] FCA 355
- Re Tawana Resources NL (No 2) [2018] FCA 1724
- Re Trust Company Limited [2013] NSWSC 1946
Category: Procedural and other rulings
Parties: Prime Media Group Limited (Plaintiff)
Seven West Media Limited (Interested Party)
Representation:
Counsel:
I M Jackman SC (Plaintiff)
J Williams (Interested Party)
Solicitors:
Allens (Plaintiff)
Herbert Smith Freehills (Interested Party)

File Number(s): 2019/343734

Judgment

Background and affidavit evidence

On 15 November 2019, I made orders convening a scheme meeting for the purposes of considering a scheme between Prime Media Group Limited (“Prime”) and its shareholders, for the reasons set out in my judgment delivered on 16 December 2019 ([2019] NSWSC 1805).
On 10 December 2019, Prime brought a further application seeking orders in respect of the despatch of supplementary information to shareholders, relating to Prime’s proposal to pay a special dividend to its shareholders on specified terms. That application was supported by an affidavit dated 10 December 2019 of Mr John Palisi, who is the chief financial officer of Prime. Mr Palisi referred to negotiations between Prime and the potential acquirer of its shares, Seven West Media Ltd (“Seven”), by which Seven had agreed to Prime paying a special dividend to its shareholders on specified terms, conditional on the scheme becoming effective (as defined in the Scheme Implementation Deed), which was to be paid prior to implementation of the scheme. Mr Palisi noted that Seven had also agreed to defer payment of certain accrued fees due under a program supply agreement between Seven and Prime to allow Prime to pay the special dividend, until the earlier of 10 business days following termination of the Scheme Implementation Deed in accordance with its terms or the business day following implementation of the scheme. Mr Palisi also referred to Prime’s announcement of its intention in respect of the special dividend to the Australian Securities Exchange (“ASX”) on 9 December 2019. Mr Palisi also referred to the steps which had been taken to prepare for despatch of a supplementary disclosure document relating to these matters and to the due diligence and verification process adopted in respect of that disclosure.
Prime…

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 Prime Media Group Ltd

Details

AGLC: Re Prime Media Group Ltd [2019] NSWSC 1888
Case: [2019] NSWSC 1888
Decision Date: 22 December 2019

CaseChat Overview and Summary

Re Prime Media Group Ltd was a case before the Supreme Court of New South Wales, concerning the approval of a supplementary disclosure document related to a scheme of arrangement for Prime Media Group Ltd. The scheme was part of a restructuring process aimed at resolving financial difficulties faced by the company. The court's role was to determine whether the supplementary disclosure document provided sufficient information to the shareholders and creditors to make an informed decision about the scheme.

The primary legal issue before the court was whether the supplementary disclosure document was adequate and appropriate, in accordance with the relevant sections of the Corporations Act 2001 (Cth). The court needed to assess whether the document complied with the statutory requirements and adequately informed stakeholders about the implications of the proposed scheme. It was also necessary to consider whether the disclosure was fair and balanced, providing a true and accurate representation of the company's financial situation and the proposed restructuring plan.

The court found that the supplementary disclosure document was satisfactory and met the necessary legal standards. The judge determined that the document provided a comprehensive overview of the scheme, including the potential risks and benefits for the shareholders and creditors. The court also considered the views of the independent experts who reviewed the document, as well as the opinions of the parties involved in the dispute. Ultimately, the judge concluded that the supplementary disclosure document was fair, balanced and sufficient for the stakeholders to make an informed decision regarding the scheme.

As a result, the court approved the supplementary disclosure document and allowed the scheme of arrangement to proceed. The final orders of the court were that the supplementary disclosure document be deemed to comply with the statutory requirements, and that the scheme of arrangement could be implemented as proposed.

Orders