BG&E Group Limited, in the matter of BG&E Group Limited (No 2) [2025] FCA 1323 (24 October 2025)

1. Section 411(4) of the Corporations Act provides that an arrangement is binding on the members of a company if, at a meeting convened in accordance with an order of the Court, a resolution in favour of the arrangement is passed by a majority in number of the members present and voting, either in person or by proxy, and passed by 75% of the votes cast on the resolution and it is approved by order of the Court.
2. On an application to approve a scheme the Court must be satisfied that all statutory and procedural requirements for the convening and conduct of the meeting have been met, that the scheme meeting is properly convened and held in accordance with the Court's orders and that the resolution put to the scheme meeting was duly passed and that there was compliance with all relevant requirements of the Corporations Act and Federal Court (Corporations) Rules 2000 (Cth). Once the Court is satisfied of these matters its discretion to approve the Scheme is enlivened.
3. In approving a scheme of arrangement, the role of the Court is supervisory. As I have already observed, the Court has a discretion whether to approve a scheme and is not bound to do so simply because it has previously made orders for the convening of a meeting or because the statutory majorities have been achieved: see Staging Connections Group Limited, in the matter of Staging Connections Group Limited (No 2) [2015] FCA 1102 at [12] and Crown Resorts Limited, in the matter of Crown Resorts Limited (No 2) [2022] FCA 710 at [11]. The matters that the Court will typically consider in deciding whether to approve a scheme include that:

(1) there has been compliance with the orders of the Court convening the scheme meeting;

(2) the resolution to approve the scheme was passed by the requisite majorities;

(3) there has been compliance with all statutory requirements;

(4) the majority of members have acted in good faith and not for any illegitimate purpose;

(5) there has been full and fair disclosure to shareholders of all information material to the decision whether to vote for or against the scheme;

(6) there is no suggestion of oppression of any minority;

(7) the scheme is fair and reasonable so that an intelligent and honest person, who is a member acting alone in relation to his or her interest as a member, might approve it;

(8) the plaintiff has brought to the Court's attention all matters that could be considered relevant to the exercise of the Court's discretion; and

(9) the scheme does not offend against any aspect of public policy,

see for example Amcor Limited, in the matter of Amcor Limited (No 2) [2019] FCA 842 at [7]- [11]; Carbon Revolution Limited, in the matter of Carbon Revolution Limited (No 3) [2023] FCA 1270 at [14]; and Viridian Financial Group Ltd, in the matter of Viridian Financial Group Ltd (No 2) [2025] FCA 1222 at [16] and in each case the authorities cited therein.

1. I was satisfied that BG&E had met the statutory and procedural requirements for approval of the Scheme.

1. In accordance with the 22 September Orders the Scheme Booklet and associated materials were dispatched by email to the Scheme Shareholders. Only two issues arose in the course of doing so: one Scheme Shareholder had not expressly elected to receive email notifications. Accordingly, the Scheme Booklet and associated materials were personally served on that shareholder; and an electronic "bounce back" notification was received in relation to two Scheme Shareholders indicating that the materials were unable to be delivered to the nominated email addresses of those Scheme Shareholders. In each case BG&E had on record an alternative email address for those shareholders and the Scheme Booklet, and associated materials were successfully dispatched to those addresses.
2. On 30 September 2025 BG&E dispatched a Supplementary Scheme Booklet as described at [9], [16]-[17] and [20] of BG&E Group. The Supplementary Scheme Booklet recorded that the independent expert, BDO Corporate Finance Australia Pty Limited, continued to conclude that the Scheme was fair and reasonable and thus in the best interests of Scheme Shareholders in the absence of a superior proposal and that the BG&E board continued to recommend that Scheme Shareholders vote in favour of the Scheme subject to that same qualification.
3. The Supplementary Scheme Booklet was dispatched in accordance with the requirements of the 22 September Orders. As to the dispatch of those materials, by the time of their dispatch the shareholder who had previously elected not to receive notifications by email had confirmed her election to do so and no electronic "bounce back" notifications were received.

1. Other information was disclosed to Scheme Shareholders after the 22 September Orders were made.
2. On 7 October 2025 BG&E announced the calculation of the exchange rate and the Relevant Ratio to be used to calculate the number of Systra Shares to be issued to Scheme Shareholders who made an election to receive scrip consideration: see BG&E Group at [11].
3. On 9 October 2025 BG&E announced the indicative outcome of the BG&E shareholders elections in relation to the form of Initial Scheme Consideration as described in BG&E Group at [10]. In total 98 Scheme Shareholders elected to receive the Initial Scheme Consideration in the form of Systra Shares. The total value of the shares to be issued in Systra for that purpose is approximately $38.5 million.
4. The evidence before me also established that a number of continuous disclosure announcements were made by BG&E and uploaded onto the investor portal after the first court hearing. According to Mr Francesco Cerra, the managing director of BG&E, none of these announcements were inconsistent with the information contained in the Scheme Booklet and the Supplementary Scheme Booklet approved by the Court or contained inaccurate or misleading information that could or would undermine the integrity of the Scheme Meeting process nor did the financial position and performance of BG&E shown in its financial statements for the financial year ended 30 June 2025 give any reasonable cause for the board of BG&E to have to reassess the merits of the Scheme or their recommendations to BG&E shareholders.

1. On 15 October 2025 BG&E announced to Scheme Shareholders that two minor technical amendments to the proposed Scheme had been agreed between BG&E and Systra. Those amendments are set out in a side letter dated 15 October 2025 between BG&E and Systra which was in evidence before me.
2. The effect of the first amendment is that three Scheme Shareholders resident in New Zealand who have provided certificates confirming that they are eligible investors for the purposes of cl 3(3)(a) of Sch 1 to the Financial Markets Conduct Act 2013 (NZ), which is a category of wholesale investor referred to in that Act, will be eligible to receive scrip consideration under the Scheme.
3. The effect of the second amendment is to permit additional time for Scheme Shareholders who have made an election to receive scrip consideration to provide certain supporting documents.
4. Section 411(6) of the Corporations Act provides that the Court may grant its approval for a compromise or arrangement subject to alterations or conditions as it thinks just.
5. In Carbon Revolution Moshinsky J summarised the applicable principles when considering an amendment for the purposes of s 411(6) at [34]:

1. The applicable principles in relation to amendment of a scheme pursuant to s 411(6) can be summarised as follows:

(a) the discretion may be exercised if the alteration is of a minor or technical kind which does not really affect the details of, or recast, the scheme: Re Adelaide Air Conditioning and Domestic Engineers Ltd (In Liq) [1972] 6 SASR 603 at 605; Re Industrea Ltd (No 2) [2012] FCA 1287 at [5]; Re Billabong International Ltd (No 2) [2018] FCA 496; 26 ACLC 18-011 at [13]; > > (b) likewise, the discretion may be exercised if the alteration is of a minor or technical kind which improves the smooth working of the scheme or which does not affect the substantive operation of the scheme: Re Permanent Trustee at [21]; Re Homemaker Retail Management Ltd [2001] NSWSC 1058; 40 ACSR 116 at [25]; > > (c) the Court will not make an alteration to a scheme unless it is satisfied that the scheme as proposed to be altered would still have been agreed to by the requisite majorities if the members or creditors (as the case may be) had considered and voted on the scheme as proposed to be altered: Re Independent Practitioner Network Ltd (No 2) [2008] FCA 1593; 26 ACLC 1,249 (Re Independent Practitioner Network) at [17]; Re Australian Co-operative Foods Ltd [2008] NSWSC 1221 at [50]; and > > (d) any alteration should not impinge upon or affect the "spirit and intendment of the scheme as a whole": Re Permanent Trustee at [21]; Re Aveo Group Ltd and Aveo Funds Management Ltd (No 2) [2019] NSWSC 1679 at [13].

See also, generally, Re Investorinfo Ltd [2005] FCA 1848; 24 ACLC 44 at [7]; Re Independent Practitioner Network at [16]; Re Professional Investment Holdings Ltd (No 2) [2010] FCA 1336 at [38]- [39].

1. I was satisfied that the amendments made to the Scheme by the side letter were of such a nature that they would not preclude the approval of the Scheme. They did not affect the detail of, or recast, the Scheme and, in the case of the second category of amendment, improved its smooth working. Those amendments could, in the circumstances, be classified as minor.

1. On 2 October 2025 BG&E held an information session to guide the Scheme Shareholders through the Scheme Booklet and to answer questions. A script and slide deck for the information session was prepared in accordance with a protocol document which emphasised that no information other than that contained in the Scheme Booklet or Supplementary Scheme Booklet was to be discussed and no undue attention should be given to any aspect of the Scheme. The information session was to be designed to assist all Scheme Shareholders to understand the Scheme Booklet and Supplementary Scheme Booklet.
2. Mr Cerra gave evidence that the information session was attended by approximately 122 Scheme Shareholders virtually and 21 Scheme Shareholders in person and that, as set out above, in advance of the session BG&E prepared a script and accompanying slide deck to be used by the presenters. The script and accompanying slide deck used by the presenters at the information session were uploaded to the BG&E investor portal. Mr Cerra is of the view that the information presented at the information session was consistent with the Scheme Booklet and the Supplementary Scheme Booklet and that no additional information was provided to Scheme Shareholders. He said that those attending were encouraged to read the Scheme Booklet and the independent expert report in full.
3. In Viridian Anderson J observed at ([23]) that "[i]n considering this type of communication with shareholders the Court's role, in exercising its supervisory jurisdiction, is to assess whether the communications compromised the integrity of the voting process at the Scheme Meetings or the adequacy of disclosure in respect of the Schemes".
4. Having regard to the evidence before me, I was satisfied that the information session did not compromise the integrity of the voting process at the Scheme Meeting or the adequacy of disclosure in the Scheme Booklet or the Supplementary Scheme Booklet.

1. The Scheme Meeting was held in accordance with the 22 September Orders. That is, at the time and place required by those Orders with Mr Peter Watson acting as chairperson of the Scheme Meeting.
2. At the Scheme Meeting, Scheme Shareholders voted on the resolution which was set out in the notice of meeting included with the Scheme Booklet (Scheme Resolution). Approximately 95% by number of BG&E Shares and approximately 80% by number of Scheme Shareholders were present at the Scheme Meeting.
3. I was satisfied that the Scheme Resolution was passed by more than 75% of the votes cast by Scheme Shareholders present and voting (including by proxy) and by majority in number of Scheme Shareholders present and voting, including by proxy. The results of the poll undertaken in respect of the Scheme Resolution were as follows:

(1) 28,022,013 votes were cast in favour of the Scheme Resolution;

(2) 17,767 votes were cast against the Scheme Resolution;

(3) three BG&E shareholders formally elected to abstain from voting on the Scheme Resolution; and

(4) 19 BG&E shareholders who attended the Scheme Meeting neither submitted a proxy form nor logged in to vote.

1. The evidence before me established that in accordance with the 22 September Orders BG&E published an announcement of details for the second court hearing. No person notified their intention to appear at the second court hearing nor, upon the matter being called three times outside the court room at the commencement of the second court hearing, did any person in fact appear.
2. The Scheme was subject to a number of conditions precedent. A conditions precedent certificate was tendered at the second court hearing by which BG&E and Systra certified and agreed that each of the conditions precedent, other than the condition requiring Court approval, set out in the SIA had been satisfied.
3. BG&E also tendered a letter from the Australian Securities and Investments Commission dated 23 October 2025 by which it advised that, pursuant to s 411(17)(b) of the Corporations Act, it has no objection to the proposed Scheme.

1. Finally, I was also satisfied that the Scheme is fair and reasonable.
2. The evidence before me established that the requisite statutory majorities of shareholders had voted in favour of the Scheme. Indeed, there was not only significant attendance by Scheme Shareholders at the Scheme Meeting but a significant number of shareholders present and voting voted in favour of the Scheme Resolution. As has been previously observed it is appropriate for me to give considerable weight to the commercial judgment of the Scheme Shareholders who voted to approve the Scheme: see Clemenger Group Limited, in the matter of Clemenger Group Limited (No 2) [2025] FCA 1289 at [44]. That is so despite the evidence that four Scheme Shareholders (representing 0.06% of the total votes cast or approximately 2.25% of the number of Scheme Shareholders present and voting) voted against the Scheme.
3. The directors of BG&E and the independent expert continued to be of the opinion that the Scheme is in the best interests of Scheme Shareholders and there has been sufficient disclosure both in the Scheme Booklet, the Supplementary Scheme Booklet and other materials made available to Scheme Shareholders.
4. In the circumstances I was satisfied that the Scheme is fair and reasonable, that there has been full disclosure made to Scheme Shareholders and that it was appropriate to exercise my discretion to approve the Scheme.

EXEMPTION FROM S 411(11) OF THE CORPORATIONS ACT

1. BG&E sought an exemption from the requirement in s 411(11) of the Corporations Act that it be required to annex to its constitution a copy of the Court's orders approving the Scheme. Section 411(12) relevantly allows the Court to exempt a body from compliance with s 411(11).
2. The purpose of s 411(11) was explained by EM Heenan J in Re Equinox Resources Ltd [2004] WASC 143; (2004) 49 ACSR 692 at 696 [22], adopted by O'Callaghan J in Clemenger at [53], as being:

... to ensure that any modification of the rights of shareholders of the company which is the subject of the scheme or any other provision in the scheme which may affect the interests of persons dealing with the company, such as prospective creditors or purchasers of shares, will be sure to have the opportunity of seeing what the exact rights of shareholders in the company or of its creditors are, as modified, if at all, by the scheme which has been approved.

1. BG&E submitted, and I agreed, that an order of this kind is appropriate in circumstances where:

(1) the Scheme will not alter the constitution of BG&E or the rights of the Scheme Shareholders, creditors or other persons dealing with the company;

(2) there is no ongoing purpose that would be served by requiring the orders approving the Scheme to be annexed to BG&E's constitution;

(3) current members of BG&E are fully informed of the Scheme and will be informed regarding the Court's approval of the Scheme; and

(4) immediately following implementation of the Scheme, BG&E will be a wholly owned subsidiary of Systra, which is well aware of the Scheme,

see Duxton Dairies (Cobram) Pty Ltd, in the matter of Duxton Dairies (Cobram) Pty Ltd (No 2) [2025] FCA 1286 at [33]- [35] (Owens J) and the authorities referred to therein.

1. I was satisfied that the exemption sought was appropriate for the reasons contended by BG&E.

1. For those reasons I made the orders sought by BG&E to approve the Scheme.

I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Markovic.