Kidman Resources Limited, in the matter of Kidman Resources Limited [2019] FCA 1226

Kidman Resources Limited, in the matter of Kidman Resources Limited [2019] FCA 1226

Orders convening the scheme meeting should be made as the scheme is fit for shareholder consideration, all statutory and procedural requirements have been satisfied, there is adequate and fulsome disclosure (including of director benefits), the break fee and exclusivity provisions are reasonable and in line with authority, there is a reasonable commercial basis for the treatment of performance rights and incentive arrangements, and there is no requirement that directors who receive a benefit abstain from making a recommendation so long as adequate disclosure is made.

Jurisdiction
Australia
Judgment Date
30 July 2019
Procedural Posture
Corporations Scheme of Arrangement / First Court Hearing (orders to Convene Scheme Meeting)
Outcome
Orders granted to convene scheme meeting.
Legal Topics
['scheme of Arrangement' "directors' Recommendations" 'shareholder Meetings' 'director Benefits' 'break Fee' 'exclusivity Arrangements' 'performance Rights' 'foreign Resident Capital Gains Withholding']
['corporations Law'] ['scheme of Arrangement' "directors' Recommendations" 'shareholder Meetings' 'director Benefits' 'break Fee' 'exclusivity Arrangements' 'performance Rights' 'foreign Resident Capital Gains Withholding']

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Procedural Posture

Corporations Scheme of Arrangement / First Court Hearing (orders to Convene Scheme Meeting)

Legal Issues

  1. 1 ['Whether to make orders convening a meeting of shareholders to consider a scheme of arrangement under s 411(1) of the Corporations Act 2001 (Cth)' 'Whether directors who are to receive a substantial financial benefit if the scheme is approved should decline to make a recommendation to shareholders as to how they should vote' 'Whether the scheme is fit for consideration by shareholders including class composition, reasonableness of break fee, adequacy of disclosure and information provided to shareholders, and other procedural requirements']

Ratio Decidendi

Orders convening the scheme meeting should be made as the scheme is fit for shareholder consideration, all statutory and procedural requirements have been satisfied, there is adequate and fulsome disclosure (including of director benefits), the break fee and exclusivity provisions are reasonable and in line with authority, there is a reasonable commercial basis for the treatment of performance rights and incentive arrangements, and there is no requirement that directors who receive a benefit abstain from making a recommendation so long as adequate disclosure is made.

Court Disposition

Orders granted to convene scheme meeting.

Orders

  • ['Wesfarmers Lithium Pty Ltd given leave to be heard without becoming a party.' 'Orders made under s 411(1) Corporations Act 2001 (Cth) for plaintiff to convene and hold a meeting of shareholders to consider and, if thought fit, approve the scheme of arrangement.' 'Scheme meeting to be held 5 September 2019 at...