Glencore International AG (ACN 114 271 055) v Takeovers Panel [2006] FCA 274

Glencore International AG (ACN 114 271 055) v Takeovers Panel [2006] FCA 274

The Takeovers Panel erred in law in concluding that Glencore's arrangements with the banks amounted to a substantial interest in Austral Coal Limited, as required by Chapter 6 of the Corporations Act 2001 (Cth), and in concluding that Glencore's non-disclosure during the relevant period had an effect on the control, or acquisition of a substantial interest in, the company sufficient to be declared unacceptable circumstances. The Panel's orders were also unsupported as they lacked the necessary jurisdictional foundation and failed to match appropriately the rights or interests affected by the unacceptable circumstances found.

Parties
First Applicant: Glencore International AG (ACN 114 271 055); Second Applicant: Fornax Investments Limited; First Respondent: Takeovers Panel (Kathleen Farrell, Peter Scott and Denis Byrne); Second Respondent: Centennial Coal Company Limited (ACN 003 714 538); Third Respondent: Australian Securities and Investments Commission; Fourth Respondent: Austral Coal Limited (ACN 069 071 816); Fifth Respondent: Credit Suisse First Boston International (ACN 062 787 106); Sixth Respondent: ABN AMRO Bank NV (ACN 079 478 612)
Jurisdiction
Australia
Judgment Date
22 March 2006
Procedural Posture
Judicial Review / Judgment on Application to Quash Declaration and Orders of Takeovers Panel
Outcome
Declaration and orders of the Takeovers Panel set aside; matter stood over for submissions as to final orders.
Legal Topics
Takeovers, Disclosure of Substantial Interest, Substantial Holding, Judicial Review, Declarations of Unacceptable Circumstances, Powers of Takeovers Panel, Cash Settled Equity Swaps, Market Practice, Compensation Orders
Corporations Law Administrative Law Securities Law Takeovers Disclosure of Substantial Interest Substantial Holding Judicial Review Declarations of Unacceptable Circumstances +4 more

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Parties

Glencore International AG (ACN 114 271 055)

First Applicant

Fornax Investments Limited

Second Applicant

Takeovers Panel (Kathleen Farrell, Peter Scott and Denis Byrne)

First Respondent

Centennial Coal Company Limited (ACN 003 714 538)

Second Respondent

Australian Securities and Investments Commission

Third Respondent

Austral Coal Limited (ACN 069 071 816)

Fourth Respondent

Credit Suisse First Boston International (ACN 062 787 106)

Fifth Respondent

ABN AMRO Bank NV (ACN 079 478 612)

Sixth Respondent

Procedural Posture

Judicial Review / Judgment on Application to Quash Declaration and Orders of Takeovers Panel

Legal Issues

  1. 1 Meaning of 'substantial interest' in Chapter 6 of Corporations Act 2001 (Cth)
  2. 2 Whether Glencore's arrangements with banks constituted a substantial interest
  3. 3 Whether Glencore's non-disclosure affected the rate, extent and consideration of Centennial's takeover bid

Ratio Decidendi

The Takeovers Panel erred in law in concluding that Glencore's arrangements with the banks amounted to a substantial interest in Austral Coal Limited, as required by Chapter 6 of the Corporations Act 2001 (Cth), and in concluding that Glencore's non-disclosure during the relevant period had an effect on the control, or acquisition of a substantial interest in, the company sufficient to be declared unacceptable circumstances. The Panel's orders were also unsupported as they lacked the necessary jurisdictional foundation and failed to match appropriately the rights or interests affected by the unacceptable circumstances found.

Court Disposition

Declaration and orders of the Takeovers Panel set aside; matter stood over for submissions as to final orders.