In the matter of Telstra Corporation Limited (No 2) [2022] NSWSC 1460

In the matter of Telstra Corporation Limited (No 2) [2022] NSWSC 1460

The scheme of arrangement satisfied all statutory and procedural requirements for approval: it was approved by the requisite majorities of shareholders, there was full and fair disclosure, creditors would not suffer material prejudice as supported by independent expert evidence and cross-guarantees, and no proper grounds of opposition were raised. The Court was satisfied the scheme was fair and reasonable, not contrary to public policy, and that orders under ss 411, 413 should be made as sought.

Parties
Plaintiff: Telstra Corporation Limited; First Defendant: Telstra Group Limited; Second Defendant: Telstra Limited; Intervener: Mr Roger de Robillard
Jurisdiction
Australia
Judgment Date
26 October 2022
Procedural Posture
Scheme of Arrangement Approval Application / Second Court Hearing (approval of Scheme)
Outcome
Orders made approving the scheme of arrangement; orders made for transfer of assets and liabilities under s 413.
Legal Topics
Schemes of Arrangement, Corporate Reconstruction, Internal Group Restructure, Creditors' Interests, Court Approval Procedure
Corporations Law Equity Schemes of Arrangement Corporate Reconstruction Internal Group Restructure Creditors' Interests Court Approval Procedure

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Parties

Telstra Corporation Limited

Plaintiff

Telstra Group Limited

First Defendant

Telstra Limited

Second Defendant

Mr Roger de Robillard

Intervener

Procedural Posture

Scheme of Arrangement Approval Application / Second Court Hearing (approval of Scheme)

Legal Issues

  1. 1 Whether the scheme of arrangement meets statutory and procedural requirements under Corporations Act 2001 (Cth) s 411
  2. 2 Whether the scheme is fair and reasonable so that an intelligent and honest shareholder might approve it
  3. 3 Whether the scheme is oppressive to minority or potential creditors

Ratio Decidendi

The scheme of arrangement satisfied all statutory and procedural requirements for approval: it was approved by the requisite majorities of shareholders, there was full and fair disclosure, creditors would not suffer material prejudice as supported by independent expert evidence and cross-guarantees, and no proper grounds of opposition were raised. The Court was satisfied the scheme was fair and reasonable, not contrary to public policy, and that orders under ss 411, 413 should be made as sought.

Court Disposition

Orders made approving the scheme of arrangement; orders made for transfer of assets and liabilities under s 413.

Orders

  • Scheme of arrangement approved under s 411(4)(b) Corporations Act 2001 (Cth)
  • Orders for transfer of certain assets and liabilities within Telstra Group under s 413