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Re Windlab Ltd

Re Windlab Ltd

Case [2020] NSWSC 571 14 May 2020

Corporate Reorganization

Schemes of Arrangement

Members' Approval

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Windlab Limited [2020] NSWSC 571
Hearing dates: 29 April 2020
Date of orders: 29 April 2020
Decision date: 14 May 2020
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Orders made convening scheme meeting.

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 members to consider and, if thought fit, approve a proposed scheme of arrangement – Whether requirements to order scheme meeting are satisfied.
Legislation Cited: - Corporations Act 2001 (Cth), Pt 2G.2, s 411, 1319
- Public Health Act 2010 (NSW)
- Public Health (COVID-19 Restrictions on Gathering and Movement) Order 2020
- Supreme Court (Corporations) Rules 1999 (NSW)
Cases Cited: - Re Amcor Ltd [2019] FCA 346
- Re APN News & Media Ltd (2007) 62 ACSR 400
- Re Ardent Leisure Ltd [2018] NSWSC 1665
- Re Associated Advisory Practices Limited [2013] FCA 761
- Re Brambles Industries Ltd (2006) 59 ACSR 501
- Re Coles Group Limited (2007) 25 ACLC 1380
- Re CSR Ltd [2012] FCAFC 34; 183 FCR 358
- Re DuluxGroup Ltd [2019] FCA 961
- Re GBST Holdings Limited [2019] NSWSC 1280
- Re Healthscope Ltd [2019] FCA 542
- Re Hostworks Group Ltd (2008) 26 ACLC 137
- Re Investa Listed Funds Management Ltd as responsible entity for the Armstrong Jones Office Fund and the Prime Credit Property Trust [2018] NSWSC 1766
- Re Kidman Resources Ltd [2019] FCA 1226
Re Macquarie Capital Alliance Ltd (2008) 67 ACSR 484
- Re Macquarie Private Capital A Limited (2008) 26 ACLC 366
- Re Mitchell Communication Group [2010] VSC 423
- Re SFE Corporation Ltd (2006) 59 ACSR 82
- Re Simavita Holdings Limited [2013] FCA 1274
- Re Skilled Group Ltd (No 1) (2015) 113 ACSR 525
- Re Villa World Ltd [2019] NSWSC 1207
Category: Principal judgment
Parties: Windlab Limited (Plaintiff)
Representation:
Counsel:
M Oakes SC (Plaintiff)
J Williams (Acquirer)
Solicitors:
Dentons Australia (Plaintiff)

File Number(s): 2020/101207

Judgment

Background and affidavit evidence

By Originating Process filed on 2 April 2020 the Plaintiff, Windlab Limited (“Windlab”) seeks orders in respect of a scheme of arrangement which would provide for the acquisition of all ordinary shares in Windlab for cash by Wind Acquisition 2 Pty Ltd (“WA2”), excluding some 18.72% of Windlab’s shares which are held by Equity Trustees Limited and in which WA2 has a relevant interest. An order is sought, at this hearing, under s 411(1) of the Corporations Act 2001 (Cth) that Windlab convene a meeting of members in respect of the scheme, and directions are also sought under s 1319 of the Act regarding the scheme.
By way of background, Windlab is a wind energy development company, with its head office in Canberra, and operations in Australia, South Africa and East Africa, which applies proprietary technology to identify, acquire and develop wind farms in Australia…

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 Windlab Ltd

Details

AGLC: Re Windlab Ltd [2020] NSWSC 571
Case: [2020] NSWSC 571
Decision Date: 14 May 2020

CaseChat Overview and Summary

Windlab Ltd applied for an order convening a meeting of its members to consider and, if thought fit, approve a proposed scheme of arrangement. The company sought the order under section 411 of the Corporations Act 2001 (Cth). The application was made in light of the company's financial difficulties and the need to restructure its debts. The primary legal issues before the court were whether the requirements of section 411 of the Corporations Act were satisfied to order a scheme meeting.

The court considered the statutory requirements for convening a meeting under section 411, focusing on whether the application met the necessary conditions, including the need for the meeting to be in the best interests of the company and its members. The court examined the company's financial statements, the proposal for the scheme, and the potential benefits to the members. It also considered whether the scheme had been negotiated in good faith and whether it provided a better outcome than the company entering liquidation. The court concluded that the application satisfied the statutory requirements for ordering a scheme meeting.

Having found that the statutory requirements were satisfied, the court granted the order for the scheme meeting to be convened. The decision allows the members of Windlab Ltd to consider and vote on the proposed scheme of arrangement, which aims to restructure the company's debts and provide a more sustainable financial future. The order paves the way for the potential restructuring of the company, subject to approval by the members at the meeting.

Orders