New Zealand Oil & Gas Limited

In the High Court of New Zealand, New Zealand Oil & Gas Limited applied for approval of a proposed arrangement under Part 15 of the Companies Act 1993. The arrangement involved a return of surplus capital to shareholders by cancelling one share in every five of the ordinary shares held. The application raised two main legal issues: the timing of the service of the originating application on the Takeovers Panel, and the test for determining "interest classes" of shareholders.

The court examined whether the notification to the Takeovers Panel was made "at the same time as filing the application," as required by section 236A(1) of the Act. The applicant argued that the notification was effectively contemporaneous, as it was done within approximately four business hours of the filing. The court agreed with the applicant, finding that the requirement should be interpreted as notification as soon as is reasonably practicable.

The second issue was the test for determining "interest classes" of shareholders. The applicant had defined two interest classes of shareholders: fully paid shares and partly paid shares. The Takeovers Panel argued that the specific criteria in Schedule 10 should be applied, while the applicant relied on the more general definitions in section 116 of the Act. The court decided that the definition in Schedule 10 should apply when code companies are assessing interest classes for the purposes of an originating application under Part 15. However, it found that the result would not be any different under either definition.

Lastly, the court assessed the merits of the application, considering whether an intelligent and honest business person might reasonably approve of the proposal. The court was satisfied that the test was met, given the substantial support for the proposal following a fully informed and adequate procedure.

The court approved the proposed arrangement as it was fair and equitable, and would not adversely affect the interests of the company's shareholders or creditors. The court also reserved leave to the applicant to apply for further directions, should that be necessary in the implementation of the arrangement.