DB Management Pty Ltd v Australian Securities Commission & Ors [1998] FCA 796

DB Management Pty Ltd v Australian Securities Commission & Ors [1998] FCA 796

The ASC declaration was not beyond power under s 730. The power is wide enough to modify s 701 so that, where there has been a takeover scheme for a class of shares and the offeror has overwhelmingly succeeded, s 701 can permit compulsory acquisition of later issued shares in the same class issued after the offer period upon exercise of options. The declaration did not compulsorily acquire options; it operated only after option holders chose to exercise options and become shareholders. Additions and substitutions were permitted by the statutory definition of modifications, and no temporal limitation prevented the declaration being made after the 2 month period in s 701(2). The asserted...

Jurisdiction
Australia
Judgment Date
07 July 1998
Procedural Posture
Appeal From a Decision of the Administrative Appeals Tribunal Affirming a Declaration Made by the Australian Securities Commission Under S 730(1) of the Corporations Law / Judgment on Appeal
Outcome
Appeal dismissed.
Legal Topics
['takeovers' 'compulsory Acquisition of Shares' 'australian Securities Commission Modification Power' 'options Over Unissued Shares' 'administrative Appeals Tribunal Review']
['corporations' 'administrative Law'] ['takeovers' 'compulsory Acquisition of Shares' 'australian Securities Commission Modification Power' 'options Over Unissued Shares' 'administrative Appeals Tribunal Review']

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Procedural Posture

Appeal From a Decision of the Administrative Appeals Tribunal Affirming a Declaration Made by the Australian Securities Commission Under S 730(1) of the Corporations Law / Judgment on Appeal

Legal Issues

  1. 1 ['Whether the declaration made by the Australian Securities Commission under s 730(1) of the Corporations Law modifying s 701 to permit compulsory acquisition of shares issued after the takeover period on exercise of options was beyond power.' 'Whether a declaration under s 730 could add or substitute words in a specified provision.' 'Whether a declaration modifying s 701 could be made after the end of 2 months after the end of the offer period.' 'Whether the Tribunal erred in law by manifest unreasonableness in its treatment of a control premium and the level of acceptances of offers for options.']

Ratio Decidendi

The ASC declaration was not beyond power under s 730. The power is wide enough to modify s 701 so that, where there has been a takeover scheme for a class of shares and the offeror has overwhelmingly succeeded, s 701 can permit compulsory acquisition of later issued shares in the same class issued after the offer period upon exercise of options. The declaration did not compulsorily acquire options; it operated only after option holders chose to exercise options and become shareholders. Additions and substitutions were permitted by the statutory definition of modifications, and no temporal limitation prevented the declaration being made after the 2 month period in s 701(2). The asserted...

Court Disposition

Appeal dismissed.

Orders

  • ['The appeal is dismissed.' 'The applicant and the third and fourth respondents pay the costs of the first and second respondents.']