Case: Re KAZ Group Ltd [2004] FCA 738
Outcome: cited
Corporation Limited, in the matter of SFE Corporation Limited [2006] FCA 670 (31 May 2006) [ Home ] [ Databases ] [ WorldLII ] [ Search ] [ Feedback ] Federal Court of Australia You are here: &nbsp; AustLII &gt;&gt; Databases &gt;&gt; Federal Court of Australia &gt;&gt; 2006 &gt;&gt; [2006] FCA 670 [ Database Search ] [ Name Search ] [ Recent Decisions ] [ Noteup ] [ Download ] [ Help ] SFE Corporation Limited, in the matter of SFE Corporation Limited [2006] FCA 670 (31 May 2006) Last Updated: 31 May 2006 FEDERAL COURT OF AUSTRALIA SFE Corporation Limited, in the matter of SFE Corporation Limited [2006] FCA 670 CORPORATIONS scheme of arrangement meeting to be convened pursuant to s 411(1) of the Corporations Act 2001 (Cth) Corporations Act 2001 (Cth) ss 411(1) , 411 (3), 411 (6) Atkins v St Barbara Mines Ltd (1997) 138 FLR 425 cited Re Arthur Yates &amp; Co Ltd (2001) 36 ACSR 758 cited Re Barbeques Galore Ltd [2005] FCA 1519 cited Re Hills Motorway Ltd (2002) 43 ACSR 101 cited Re KAZ Group Ltd [2004] FCA 738 cited IN THE MATTER OF SFE CORPORATION LIMITED ABN 74 000 299 392; SFE CORPORATION LIMITED NSD 934 OF 2006 GYLES J 31 MAY 2006 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 934 OF 2006 IN THE MATTER OF SFE CORPORATION LIMITED ABN: 74 000 299 329 BETWEEN: SFE CORPORATION LIMITED PLAINTIFF JUDGE: GYLES J DATE: 31 MAY 2006 PLACE: SYDNEY REASONS FOR ORDERS 1 On 29 May 2006 I made orders convening a meeting of members of SFE Corporation Limited (SFE) pursuant to s 411(1) of the Corporations Act 2001 (Cth) (the Act) and ancillary orders. I said I would deliver short reasons for those orders. These are those reasons. 4 The obligations of ASX, in particular in relation to the Scheme consideration, are backed up by an executed deed poll as is the case in many such schemes. I have remarked in other cases (eg Re KAZ Group Ltd [2004] FCA 738) that this procedure is not entirely satisfactory as, in the event of default or delay, the shareholder whose shares have been actually acquired is left with the remedy of suing upon a deed poll. It may be that in this case the practical risk is slight. Indeed, the provision of undertakings plus appropriate evidence, if and when the matter comes back for approval, may eliminate the risk for all practical purposes. It seems to me, however, that schemes of this kind would be more acceptable if a procedure be devised whereby a mechanism were built in by which a third party such as a trustee company would have the role of suing on behalf of former shareholders in the target company. An alternative safeguard in relation to the cash portion of the payment would be to set aside a trust fund immediately before the vesting of the shares in the acquiring company. I do not see why shareholders whose shares are divested should run any performance risk so far as the quid pro quo is concerned. 5 My attention was drawn to the provisions relating to ineligible foreign shareholders and to breach of the law or the ASX Constitution . I saw no problem with them. 6 The Implementation Agreement includes exclusivity provisions including 'no shop' and 'no talk' restrictions. It also provides for a break fee to be paid by one side or the other in certain circumstances which could amount to over $11 million.