NZ Windfarms Ltd
[2025] NZHC 1955
•16 July 2025
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2025-404-001051
[2025] NZHC 1955
UNDER Part 19 of the High Court Rules 2016 IN THE MATTER
of a scheme of arrangement under Part 15 of the Companies Act 1993
AND
IN THE MATTER
of NZ WINDFARMS LIMITED
Applicant
Hearing: 16 July 2025 Appearances:
G D Simms and N F D Moffatt for Applicant
Judgment:
16 July 2025
JUDGMENT OF LANG J
[on application for approval of scheme of arrangement]
This judgment was delivered by Justice Lang On 16 July 2025 at 11.00 am
Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar
Date:…………………………
Solicitors/counsel:
Wynn Williams, Auckland
RE NZ WINDFARMS LTD [2025] NZHC 1955 [16 July 2025]
[1] As its name suggests, NZ Windfarms Ltd (Windfarms) is a specialist windfarm owner and operator. It has 363,900,692 ordinary shares on issue, and is listed on the New Zealand Stock Exchange (NZX). Windfarms derives its revenue primarily from the sale of sustainably generated electricity. This is largely produced by turbines located at a site in the Tararua Ranges, approximately 11 kilometres from Palmerston North.
[2] In the course of its business Windfarms has dealt extensively with another NZX-listed company, Meridian Energy Ltd (Meridian). Meridian is also currently Windfarm’s largest single shareholder, holding 19.99 per cent of Windfarm shares. Following preliminary negotiations Windfarms entered into a scheme implementation agreement (SIA) with Meridian on 18 February 2025. Under the SIA, it is intended that Meridian will acquire all the shares in Windfarms that it does not already own for the sum of 25 cents per share. Shareholders will receive payment in cash for their shares.
[3] It is a condition of the SIA that the Court gives its approval to the proposed scheme of arrangement (scheme) under s 236 of the Companies Act 1993 (the Act). Windfarms has therefore filed an originating application seeking orders to that effect. This judgment deals with that application.
Procedural background
[4] The proposed scheme was publicly announced on NZX’s market announcement platform on 19 February 2025. A copy of the SIA was also uploaded to Windfarms’ NZX page at the same time as the announcement.
[5] On 7 April 2025, Meridian provided Windfarms with a copy of a Deed Poll it had executed in favour of the Takeovers Panel. This confirmed that Meridian would cast its voting rights in favour of the scheme. Thereafter further announcements were made on the NZX platform as Meridian obtained commitments from several of Windfarms’ shareholders to vote in favour of the scheme.
[6] On 12 May 2025, I issued a Minute in which I made procedural directions designed to ensure that notice of the application for approval of the scheme would be
provided in a timely and appropriate manner to Windfarms’ shareholders and other affected parties, including Meridian and the Takeovers Panel.
[7] A further condition of the SIA was that Windfarms’ shareholders approved the scheme. This condition was satisfied when Windfarms’ shareholders passed a resolution that the scheme be approved at a special meeting held on 24 June 2025. This led to the present application.
The law
[8] Section 236(1) of the Act permits this Court to order a scheme of arrangement to be binding on a company on such terms and conditions as the Court thinks fit.
[9] In the present case, s 236A of the Act is also engaged because Windfarms is a “code company” as that term is defined in s 2(1) of the Takeovers Act 1993. Further, the scheme affects the voting rights of Windfarms’ shareholders. Section 236A relevantly provides as follows:
236A Arrangement or amalgamation involving code company
(1)If a proposed arrangement or amalgamation affects the voting rights of a code company, the applicant for an order under section 236(1) must, at the same time as filing the application, notify the Takeovers Panel of the application.
(2)The court may not make an order under section 236(1) that affects the voting rights of a code company unless—
(a)the code company’s shareholders approve the arrangement or amalgamation in accordance with subsection (4); and
(b)either of the following applies:
(i) the court is satisfied that the shareholders of the code company will not be adversely affected by the use of section 236(1) rather than the takeovers code to effect the change involving the code company; or
(ii)the applicant has filed a statement from the Takeovers Panel indicating that the Takeovers Panel has no objection to an order being made under section 236(1).
(3)The court need not approve a proposed arrangement or amalgamation merely because the Takeovers Panel has no objection to an order being made under section 236(1).
(4)For the purposes of subsection (2)(a), the code company’s shareholders may only approve the arrangement or amalgamation in the following way:
(a)by a resolution approved by a majority of 75% of the votes of the shareholders in each interest class entitled to vote and voting on the question; and
(b)by a resolution approved by a simple majority of the votes of those shareholders entitled to vote.
…
[10] As s 236A confirms, the Takeovers Panel has an important role to play in relation to a scheme such as the present. Its review of a proposal focusses particularly on whether classes of shareholders have been appropriately identified and on the quality of disclosure to shareholders in the scheme documentation. The fact that the Panel has no objection to a scheme is obviously likely to be given significant weight. However, the granting of approval under s 236 is ultimately a matter for the Court.
[11] The test to be applied where the Court is asked to approve a scheme of arrangement is now well established through cases such as Re Nuplex Industries, Re Fliway Group Ltd and Re Abano Healthcare Group Ltd.1 In considering whether a scheme should be approved, the Court generally has regard to whether:
(i)there has been compliance with the statutory provisions as to meetings, resolutions and procedural directions made by the Court;
(ii)the scheme has been fairly put to the class or classes concerned so that shareholders have all the information reasonably necessary to enable them to judge and vote upon the proposals;
(iii)the classes were fairly represented by those who attended the meeting, and that the statutory majority are acting bona fide and are not coercing the minority in order to promote interests adverse to those of the class whom they purport to represent; and
1 Re Nuplex Industries Ltd [2016] NZHC 1677; Re Fliway Group Ltd [2017] NZHC 3216; and
Re Abano Healthcare Group Ltd [2020] NZHC 3343.
(iv)the arrangement was such that an intelligent and honest person of business, a member of the class concerned, and acting in respect of his or her interests, might reasonably approve it.
[12] In considering whether an intelligent and honest person of business might reasonably approve the scheme, the Court will consider whether the proposed arrangements is generally fair and equitable.2
Has there been compliance with the relevant statutory provisions and procedural directions given by the Court?
[13] For the reasons that follow, the evidence filed in support of the application satisfies me that Windfarms has complied fully with both the relevant statutory provisions and the procedural orders made on 12 May 2025.
[14] The procedural orders required Windfarms to provide shareholders with access to the scheme meeting materials no later than 15 working days before the scheme meeting, which was scheduled for 24 June 20205. Windfarms engaged its share registrar, MUFG Corporate Markets (MUFG), to assist it in complying with statutory requirements and the procedural orders. MUFG is a financial services company that has experience in assisting companies to comply with the procedural requirements of proposed schemes of arrangement such as the present.
[15] The scheme materials were posted on the NZX announcement platform on 19 May 2025, 24 working days before the scheme meeting. On the following day they were uploaded to Windfarms’ website, together with a copy of the procedural orders and the present application.
[16] MUFG then sent the scheme materials to shareholders who were listed on the share register as at 5 pm on 16 May 2025. This occurred on 21 May 2025, which was 21 working days before the scheme meeting. The materials were sent to shareholders at the email or postal addresses recorded in the share register as at 16 May 2025. A hard copy of the materials was also available for inspection by
2 Re Nuplex Industries Ltd, above n 1, at [11], citing Re Auckland International Airport [2014] NZHC 405 at [9].
shareholders at the offices of Wynn Williams, the law firm representing Windfarms on the present application.
[17] The scheme meeting took place as scheduled on 24 June 2025. It was held in person at MUFG’s offices and shareholders could also attend remotely by using MUFG’s online meeting platform. Those who attended the meeting were given the chance to ask questions about the proposal and several shareholders took advantage of this opportunity. Shareholders were then asked to vote on a resolution that the scheme be approved. Only those who were shareholders as at 5 pm on 22 June 2025 were eligible to vote on the resolution. MUFG searched the share register to ensure that those who voted at the meeting held shares in the company as at that time.
[18] The procedural orders required shareholders’ votes to be split, and recorded, into two interest classes for the purposes of the resolution. The first class comprised only Meridian, while the second class comprised all other shareholders.
[19] Voting was conducted by poll as required by NZX listing rule r 6.1 and the procedural orders. It was supervised by members of MUFG’s staff. A total of 368 shareholders who owned 239,955,842 shares voted by proxy or post. One proxy form was received after the deadline of 9 am on 22 June 2025. However, that shareholder attended the meeting and voted online.
[20] Not surprisingly, Meridian cast its 72,743,748 votes in favour of the resolution. In the second class, 166,563,973 votes (or 96.50 per cent) were cast in favour of the resolution whilst 6,036,348 votes (or 3.50 per cent) were cast against it. Shareholders holding a total of 178,214 votes abstained from voting.
[21] This meant that, of all eligible voters (being all shareholders as at the voting eligibility date), a total of 239,307,721 (or 65.76 per cent) votes were cast in favour of the resolution whilst 6,036,348 (or 1.66 per cent) were cast against it. Shareholders who owned a total of 178,214 votes or (0.05 per cent) abstained from voting on the resolution. The resolution was accordingly passed in accordance with the majorities required by s 236A(4).
[22] The results of the scheme meeting were announced and lodged on the NZX market announcement platform immediately after MUFG advised Windfarms of the voting results.
[23] Windfarms also complied with its obligation under s 236A(1) to notify the Takeovers Panel of the present application. The Panel issued a “no-objection statement” on 7 July 2023 confirming that it has no objection to the scheme. This satisfies the requirements of s 236A(b)(ii) of the Act.
[24] Even if the Court grants approval, the SIA will still be conditional upon several events not occurring prior to the date the scheme is implemented. These so-called “negative conditions” have been disclosed to shareholders and include the Commerce Commission taking no steps to prevent or delay the scheme. This condition will remain in existence until 5 pm on the day before the scheme is to be implemented. However, the existence of such conditions is not a matter that prevents the Court from approving a scheme.3 At this stage there is in any event no suggestion that the Commerce Commission is likely to take steps to prevent or delay the scheme or that any of the other negative conditions may apply.
Was the scheme fairly put to the shareholders?
[25] The primary means by which Windfarms’ shareholders were made aware of the scheme was through the scheme meeting materials that were forwarded to all shareholders either electronically (where their email addresses were known) or by post. As I have already noted, a hard copy of the materials was also available for inspection at Wynn Williams’ offices. No shareholder took the opportunity to inspect these documents.
[26] In my view, the scheme materials fully and fairly explained the proposal, including the reasons why it was put forward and its intended effect. Further, they were distributed to Windfarms’ shareholders within sufficient time before the meeting to enable them to consider the proposal and, if necessary, take steps to question and
3 Re Arvida Group Ltd [2024] NZHC 3053 at [17]–[18]; and Re CIP Holdings Ltd [2025] NZHC 581 at [25].
oppose it. As I have already noted, those who attended the scheme meeting were also given the opportunity to ask questions regardless of whether they appeared in person or remotely. The shareholders also had an opportunity to register questions online before the scheme meeting was held. Finally, shareholders were given an opportunity to oppose the present application if they wished to do so.
[27] In this context the Court may also place considerable weight on the fact that the Takeovers Panel has issued a no objection letter.4
[28] I have no hesitation in concluding that the scheme was fairly put to shareholders.
Were the classes fairly represented at the scheme meeting?
[29] The whole of the first class of shareholders, namely Meridian, was present and voted at the scheme meeting. In the second class, a total of approximately 67 per cent of all eligible shareholders voted either in person or via proxy. I consider this means that the outcome reflected the votes cast by a fair representation of the company’s shareholders as a whole. There is no suggestion of the coercion of the minority who voted against the scheme.
Was the arrangement such that an intelligent and honest person of business might reasonably approve it?
[30] As will be evident, those who attended the scheme meeting overwhelmingly supported the proposal. The authorities emphasise that the Court should give particular weight to the views of the shareholders because they are best placed to determine what is in their own interests.5 In the present case the outcome of the votes cast at the scheme meeting must be regarded as clear and definitive.
[31] In deciding how to vote, shareholders are likely to have placed weight on a comprehensive report that Windfarms commissioned from Calibre Partners, an
4 Re Abano Healthcare Group Ltd, above n 1, at [31]; and Re Pushpay Holdings Ltd [2023] NZHC 1083 at [19].
5 Re Abano Healthcare Group Ltd, above n 1, at [36]; Re Nuplex Industries Ltd, above n 1, at [24];
Re Fliway Group Ltd, above n 1, at [24].
independent chartered accounting and advisory firm. Calibre Partners has considerable experience in acting as independent advisors for companies subject to the Takeovers Code. The Takeovers Panel approved the appointment of Calibre Partners as the independent advisor for this scheme on 21 February 2025. Windfarms announced the appointment on its NZX page on 24 February 2025.
[32] Calibre Partners provided a final copy of its report on 2 May 2025. This reflected comments and questions it had received from the Takeovers Panel in relation to its draft report. The report made the following observations:
(i)The proposed consideration of $0.25 per share is above [Calibre Partners’] assessed valuation range of $0.190 to $0.229 per share, and above [Calibre Partners’] projected value range of $0.198 to $0.239 per share as at 30 June 2025.
(ii)The proposed consideration represents a premium of 107% to the closing share price of NZ Windfarms of $0.1210 on 18 February 2025, which was the last trading day before the SIA was announced to the market.
(iii)If the Scheme is not implemented [Calibre Partners] consider there is a real prospect that NZ Windfarms’ share price could recede from current levels.
(iv)In [Calibre Partners’] opinion the offer is reasonable. The proposed consideration of $0.25 per share is above the assessed fair market range for NZ Windfarms.
[33] As the Court has done in other cases, I place significant weight on the report issued by the independent advisor.6 I note also that Windfarms’ directors, none of whom holds shares in the company, have unanimously recommended that the proposal be approved.7
[34] I also take on board the advice from Calibre Partners that, if the proposal does not proceed, Windfarms’ share price is likely to revert to that which applied prior to the date of the announcement of the scheme. This would result in shareholders losing the opportunity to make a significant gain on the sale of their shares. These factors
6 See for example, Re Nuplex Industries Ltd, above n 1 at [27]; Re Fliway Group Ltd, above n 1, at [23]; and Re Abano Healthcare Group Ltd, above n 1, at [39].
7 Similarly, see Re Nuplex Industries Ltd, above n 1, at [25]; Re Fliway Group Ltd, above n 1, at [24]; and Re Abano Healthcare Group Ltd, above n 1, at [37].
mean it is difficult to see why any intelligent and honest person in business would not approve the scheme.
[35] Further, no third party will be adversely affected or prejudiced by the scheme. Nor will it have any impact on Windfarms’ solvency or viability. Its only secured creditor will not be affected in any adverse way by the scheme because it affects only the shares of the company and not its assets. For these reasons the scheme must be regarded as fair and equitable.
Result
[36] I make an order under s 236(1) of the Act that the scheme of arrangement between Meridian and NZ Windfarms and its shareholders (Scheme) described in the Scheme Plan (annexed to both the application and to the draft orders) is approved and binding with immediate effect upon:
(i)NZ Windfarms;
(ii)every person who is a shareholder of NZ Windfarms as at the Record Date (as defined in the Scheme Plan);
(iii)Meridian; and
(iv)all other persons as are necessary to give effect to the Scheme.
[37] Windfarms has leave to seek further directions if the implementation of the scheme should make this necessary.
Lang J
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