Z Energy Limited - [2022] NZHC 841

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2022-485-55

[2022] NZHC 841

IN THE MATTER

Commercial Panel

of a scheme of arrangement under Part 15 of the Companies Act 1993

IN THE MATTER

of an application by Z ENERGY LIMITED Applicant

Hearing: 26 April 2022

Counsel:

L L Fraser and L A Murton for Applicant

J Q Wilson and T M J Shiels for Ampol Limited and Ampol Holdings NZ Limited (Interested Party)

Judgment:

27 April 2022

REASONS JUDGMENT OF ELLIS J

[1] Following a hearing on 26 April 2022, I made orders under Part 15 of the Companies Act 1993 approving a scheme of arrangement (the Scheme) that will effect the acquisition by Ampol Holdings NZ Limited (Ampol NZ) of all the shares in Z Energy Limited (Z Energy).

[2]My reasons for making those orders are set out below.

Background

[3] Z Energy filed an originating application seeking approval of the Scheme on 17 February 2022. On 21 February the Court made procedural orders relating to

RE Z ENERGY LIMITED [2022] NZHC 841 [27 April 2022]

service, representation and obtaining shareholder approval for the Scheme (the procedural orders). As well, time was needed to obtain regulatory approval under the Overseas Investment Act 2005 and the Commerce Act 1986, as well as from the Takeovers Panel and, possibly, the NZX and ASX.

[4] At the time of the hearing before me, Z Energy’s position was that the procedural orders have now been complied with and the relevant consents have been obtained. It therefore sought the Court’s final approval of the Scheme.

Relevant parties

Z Energy Limited

[5] Z Energy is a registered, New Zealand limited company, listed on the NZX Main Board and the ASX.

[6] Z Energy was incorporated in 1959 as “Shell Oil New Zealand Limited”. Through its subsidiaries, Z Energy is an owner and operator of service stations, truck shops, pipelines, terminals and bulk storage terminal infrastructure around New Zealand. Z Energy supplies fuel to retail customers and large commercial customers such as airlines, trucking companies, shipping companies and vehicle fleet operators. Z Energy currently owns and operates a portfolio of approximately 197 service stations and 135 truck shops, located around New Zealand. As well, Caltex—a brand which is operated by Z Energy under licence from Chevron International—operates 133 service stations and 66 truck stops across New Zealand.

[7] As of 15 February 2022, Z Energy had 15,638 shareholders and a total of 520,476,853 shares on issue. There is only one class of shares, and all are fully paid up, ordinary shares, with identical voting rights.

Ampol Limited and Ampol Holdings NZ Limited

[8] The proposed acquirer of Z Energy’s shares under the Scheme is Ampol NZ, a wholly owned subsidiary of Ampol Ltd (Ampol), which is an Australian company listed on the ASX. Ampol’s principal activities include the purchase, supply, refining, distribution and sale of petroleum products and the operation of convenience retail

stores throughout 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.

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Details

AGLC: Z Energy Limited [2022] NZHC 841
Case: [2022] NZHC 841
Decision Date: 27 April 2022

CaseChat Overview and Summary

Z Energy Limited sought the High Court’s approval of a scheme of arrangement to effect the acquisition of all shares in Z Energy by Ampol Holdings NZ Limited, a wholly owned subsidiary of Ampol Limited. The court had to determine whether the scheme met the statutory requirements, had been fairly put to shareholders, and would be approved by reasonable and intelligent businesspeople. Z Energy had complied with the statutory requirements, provided shareholders with adequate information to make an informed decision, and obtained shareholder approval of the scheme. The scheme provided a premium to shareholders and had the unanimous recommendation of Z Energy’s board. The court approved the scheme of arrangement.

Orders