In the matter of Flinders Ports Pty Limited (ACN 097 377 172) [2008] FCA 82 (8 February 2008)

Last Updated: 19 February 2008

FEDERAL COURT OF AUSTRALIA

In the matter of Flinders Ports Pty Limited (ACN 097 377 172) [2008] FCA 82

CORPORATIONS – proposed scheme of arrangement concerning Pt 5.1 body – order for approval of meeting of members




Corporations Act 2001 (Cth) ss 411(1), 411(3), Pt 5.1
Corporations Regulations 2001 Sch 8 Pt 3


















IN THE MATTER OF FLINDERS PORTS PTY LIMITED (ACN 097 377 172)

No SAD 184 of 2007





FINN J
8 FEBRUARY 2008
ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 184 OF 2007

IN THE MATTER OF FLINDERS PORTS PTY LIMITED (ACN 097 377 172)

ON THE APPLICATION OF:

FLINDERS PORTS PTY LIMITED ACN 097 377 172 Applicant

JUDGE:	FINN J
DATE OF ORDER:	8 FEBRUARY 2008
WHERE MADE:	ADELAIDE

THE COURT ORDERS THAT:

1. Pursuant to s 411(1) of the Corporations Act 2001 (Cth), the plaintiff to convene a meeting (Share Scheme Meeting) of the holders of ordinary shares in the plaintiff (shareholders) for the purpose of considering and, if thought fit, approving, the scheme of arrangement (Share Scheme) between the plaintiff and its shareholders.

2. The Share Scheme Meeting take place at 296 St Vincent Street, Port Adelaide, South Australia on Thursday, 6 March 2008 at 4.00 pm (Adelaide time).

3. Notice of the Share Scheme Meeting shall be given by the plaintiff in accordance with the Corporations Act 2001 and the plaintiff’s constitution to all persons who are entitled to notice by sending to such persons documents in the form or substantially in the form of the Scheme Booklet, including the Notice of Share Scheme Meeting, contained in Schedule A.

4. That John Arthur Rickus, or failing him, Rodney John Payze be appointed and act as chairman of the Share Scheme Meeting.

5. The chairman of the Share Scheme Meeting shall report the result of that meeting to this Honourable Court.

6. Pursuant to s 411(1) of the Corporations Act 2001, the explanatory statement for the Share Scheme contained in the Scheme Booklet which forms Schedule A, be approved.

7. The proceedings be stood over to 13 March 2008 at 9.00 am before Justice Finn for the hearing of any application to approve the Share Scheme and Option Scheme.

8. There be liberty to apply.


Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 184 OF 2007

IN THE MATTER OF FLINDERS PORTS PTY LIMITED (ACN 097 377 172)

ON THE APPLICATION OF:

FLINDERS PORTS PTY LIMITED ACN 097 377 172 Applicant

JUDGE:	FINN J
DATE:	8 FEBRUARY 2008
PLACE:	ADELAIDE

REASONS FOR JUDGMENT

1 The plaintiff, Flinders Ports Pty Limited, seeks an order that it convene a general meeting of all of its shareholders pursuant to s 411(1) of the Corporations Act 2001 (Cth). The object of the order is to consider and vote on a proposed scheme of arrangement to be undertaken interdependently with a selective capital reduction. The aim of the scheme is for Flinders Ports to become a wholly-owned subsidiary of Flinders Port Holdings Pty Ltd ("Flinders Holdings") with the shareholders of Flinders Ports, other than Flinders Holdings, having shares issued to them by Flinders Ports Holdings in the same proportions as in Flinders Ports.

2 I would note in passing that each shareholder in Flinders Ports, apart from Flinders Holdings, already holds the same percentage of shares in Flinders Holdings as they do in Flinders Ports, and the directors of the two companies are identical. At this stage of the application, there are a number of procedural and substantive matters of which I should be satisfied before ordering a meeting pursuant to s 411(1). These are:

(1) that proper disclosure has been made in the draft explanatory statement, or Scheme Booklet, as defined in s 411(3) of the Act;

(2) that the scheme can properly be described as "an arrangement" for present purposes so as to come within s 411;

(3) that the plaintiff be a Pt 5.1 body;

(4) that the scheme has been properly proposed; and

(5) that the Australian Securities and Investments Commission has had a reasonable opportunity to examine the terms of the scheme and make submissions to the court.

3 It is not my function at this stage to determine the business or commercial efficacy of the proposed arrangement. That remains for another day, assuming that the shareholders vote in favour of the scheme. In relation to the s 411(3) requirement that the draft explanatory statement explain the effect of the scheme and set out the information that is material to the making of a decision by a shareholder, and that it contain the "prescribed information" which is set out in Sch 8 Pt 3 of the Corporations Regulations 2001, I am satisfied, having read the documentation, that both of these matters have been complied with. In particular, the "prescribed information" is set out in detail in Pt 2, section 12 of the draft Scheme Booklet.

4 The courts have observed on occasion that s 411 should be construed liberally and this, in particular, in relation to the meaning of the term "arrangement". I am satisfied that the proposed scheme here between a company and its members clearly constitutes an arrangement for the purposes of the Act. Equally Flinders Ports is a Pt 5.1 body, being a proprietary company. The scheme is one which I consider the Court, prima facie, would approve, should the requisite majorities vote in its favour, and I am satisfied that on its face there is no impediment which would disincline me from approving the explanatory documentation.

5 The Australian Securities and Investments Commission was notified of the plaintiff’s application for orders convening the scheme meeting and has provided a letter in which it states that it does not propose to intervene to oppose the proposed scheme at this hearing.

6 Accordingly, I am prepared to make orders in terms of the draft minutes of orders that have been annexed to the submissions provided by counsel for Flinders Ports, the one alteration to that being that the proceedings be stood over to 13 March 2008 at 9.00 am.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.

Associate:
Dated: 18 February 2008

Counsel for the Applicant:	Mr M Hoffmann QC
Solicitor for the Applicant:	Minter Ellison
Date of Hearing:	8 February 2008
Date of Judgment:	8 February 2008