In the matter of Apiam Animal Health Limited (No 2)

Catchwords: CORPORATIONS — arrangements and reconstructions — schemes of arrangement or compromise — application under s 411 of the Corporations Act 2001 (Cth) for orders approving scheme of arrangement and ancillary orders

Legislation Cited: - Corporations Act 2001 (Cth), ss 411, 1319

Cases Cited: - Re Apiam Animal Health Ltd [2025] NSWSC 1563
- Re InvoCare Ltd (No 2) [2023] NSWSC 1350
- Re Southern Cross Gold Ltd (No 2) [2025] NSWSC 2

Category: Principal judgment

Parties: Apiam Animal Health Limited (Plaintiff)
Pepper BidCo Pty Ltd (Bidder)

Representation: Counsel:
M Izzo SC / APF Ryan (Plaintiff)
I Ahmed SC (Bidder)
Solicitors:
Herbert Smith Freehills Kramer (Plaintiff)
Ashurst (Bidder)

File Number(s): 2025/444908

Judgment

1. By Originating Process filed on 17 November 2025, the Plaintiff, Apiam Animal Health Ltd (“Apiam”) sought orders under ss 411 and 1319 of the Corporations Act 2001 (Cth) (“Act”) in relation to a proposed scheme of arrangement between Apiam and holders of its ordinary shares other than certain excluded shareholders. Apiam is an Australian public company limited by shares and listed on the Australian Securities Exchange (“ASX”). It is a rural veterinary business providing clinical and allied services to the companion animal and livestock industries. The proposed scheme provides for the acquisition of 100% of Apiam's ordinary shares by Pepper BidCo Pty Ltd (“BidCo”), which is a wholly owned subsidiary of Pepper HoldCo Limited (“HoldCo”). BidCo and HoldCo are controlled by Adamantem Capital Fund II, which is managed and advised by Adamantem Capital Management Pty Ltd (together, “Adamantem”).

2. I made the orders sought by Apiam at the conclusion of the hearing on 12 December 2025, for the reasons set out in my judgment in Re Apiam Animal Health Ltd [2025] NSWSC 1563. The scheme meeting was then held on 3 February 2026, and the scheme was then approved by the requisite majorities of Apiam shareholders for the purposes of s 411(4)(a)(ii) of the Act.

3. At this second Court hearing, Apiam seeks orders approving the scheme. No Apiam shareholder or other person indicated an intention to appear at this hearing or appeared to oppose the approval of the scheme, and I made the orders sought by Apiam at the conclusion of this hearing. These are my reasons for making those orders, and I have drawn on the helpful submissions of Mr Izzo and Mr Ryan who appear for Apiam in this judgment.

Affidavit evidence

4. Apiam reads the affidavit dated 4 February 2026 of Mr Andrew Vizard, its non-executive chairman, who gives evidence of the registration of the scheme booklet with the Australian Securities & Investments Commission (“ASIC”); the dispatch of materials to Apiam shareholders; and the conduct of the scheme meeting, the passage of the scheme resolution and voting participating rate at that meeting. Some 99.94% of the votes cast at that meeting were in favour of the proposed scheme (excluding shareholders who abstained), and 95.76% of shareholders who cast votes were in favour of the proposed scheme, again excluding shareholders who abstained. Some 76.36% of available votes were cast at the scheme meeting, representing 15.68% of shareholders by number, and voting participation rates were higher than at recent Apiam annual general meetings in November 2024 and 2025, where 6.27% and 5.47% of shareholders by number respectively attended, and 60.84% and 18.82% of shares respectively were voted. Mr Vizard also addresses the publication of the notice in respect of this hearing and an announcement made by Apiam to the ASX regarding a special dividend payable in connection with the scheme.

5. Apiam also reads an affidavit dated 5 February 2026 of Mr Luke Hastings, its solicitor, who addresses an ASX announcement regarding the Apiam Board’s determination in respect of the Special Dividend. Apiam also tenders a conditions precedent certificate in respect of the satisfaction or waiver of the conditions precedent to the scheme and a letter dated 5 February 2026 from ASIC stating that ASIC has no objection to the scheme pursuant to s 411(17)(1)(b) of the Act.

Applicable principles

6. Mr Izzo and Mr Ryan submit that:

“The principles that apply to the role of the Court in approving a scheme of arrangement under s 411(4)(b) of the Act are well established. In summary, the Court must:

(a) be satisfied that the statutory and procedural requirements have been satisfied; and

(b) exercise its discretion as to whether or not to approve the Scheme.

As to the satisfaction of the statutory and procedural requirements, the Court must be satisfied that the plaintiff has complied with the orders of the Court convening the meeting of members and that the meeting of members so convened has approved the scheme with the requisite majorities. As to the matters relevant to the exercise of discretion, there is no exhaustive statement of the matters as to which the Court must be satisfied before exercising its discretion to approve a scheme. Nevertheless, the following are matters that are generally taken into account in the exercise of the Court's discretion:

(a) whether the scheme complies with the statutory and regulatory requirements for schemes of arrangement;

(b) whether the scheme members have voted in good faith and not for an improper purpose;

(c) whether there has been accurate and comprehensive disclosure of the details of the scheme and its effect to those voting on it;

(d) whether minority shareholders would be oppressed by the scheme;

(e) whether the scheme is fair and reasonable in the sense that an intelligent and honest shareholder who is a member of the relevant class, properly informed and acting alone might approve it;

(f) whether the scheme offends public policy; and

(g) whether all matters that could be considered relevant to the exercise of the Court’s discretion have been brought to the attention of the Court.”

7. I also referred to several of those matters in Re InvoCare Ltd (No 2) [2023] NSWSC 1350 at [8]–[9] and again in Re Southern Cross Gold Ltd (No 2) [2025] NSWSC 2 at [8], where I observed that:

“The Court must be satisfied of several matters in order to approve a scheme of arrangement at the second Court hearing, namely that the plaintiff has complied with the orders of the Court convening the meeting of members; the meeting of members so convened has approved the scheme with the requisite majorities; all other statutory requirements have been satisfied; the scheme is fair and reasonable so that an intelligent and honest person who was a member of the relevant class, properly informed and acting alone, might approve it; the plaintiff has brought to the attention of the Court all matters that could be considered relevant to the exercise of the Court’s discretion; and there was full and fair disclosure to members of all information material to the decision whether to vote for or against the applicable scheme: Re Permanent Trustee Co Ltd (2002) 43 ACSR 601; [2002] NSWSC 1177 at [8]-[10]; Re Central Pacific Minerals NL [2002] FCA 239 (“Central Pacific Minerals”) at [8]-[14]; Re Seven Network (No 3) (2010) 267 ALR 583; [2010] FCA 400 … at [35]-[39]; Re Solution 6 Holdings Ltd (2004) 50 ACSR 113; [2004] FCA 1049 at [18]-[24]; Re Redcape Property Fund Ltd and the Trust Company (RE Services) Ltd (as the responsible entity for the Redcape Property Trust) [2012] NSWSC 486 at [7]; Re Amcor Ltd (No 2) [2019] FCA 842 at [7]-[11]; Re Ellerston Global Investments Ltd [2020] NSWSC 1108 (“Ellerston”) at [10]-[12]; Re Coca-Cola Amatil Ltd [2021] NSWSC 489 at [9]; Re Pendal Group Ltd (No 3) [2023] NSWSC 14 at [9]. The Court will also have regard to shareholders’ assessment of their interests as manifested in the voting results on the scheme resolution in recognising that shareholders are “the best judges of whether an arrangement is to their commercial advantage”: Central Pacific Minerals at [13]; Ellerston at [10].”

Submissions and determination

8. I am satisfied that Apiam complied with the Court’s orders in respect of the distribution of scheme documents to its shareholders. The scheme booklet and convening orders were lodged with ASIC; the despatch of the scheme materials to Apiam shareholders and the conduct of the scheme meeting is addressed in the evidence; and the scheme resolution was passed by the statutory majorities. Apiam shareholders voted in favour of the scheme by the requisite statutory majorities. As I noted above, the voting participation rate at the scheme meeting was higher than that seen at Apiam’s recent annual general meetings and there is no reason to think there was any defect in the notice of the scheme given to Apiam shareholders.

9. The other statutory requirements for the scheme have been satisfied. The scheme was here recommended by Apiam’s independent board committee and the independent expert expressed the view that the scheme was in the best interests of Apiam shareholders in the absence of a superior proposal, by reference to the cash alternative available under the scheme. There is no reason to doubt that the scheme is fair and reasonable so that an intelligent and honest Apiam shareholder, properly informed and acting alone, might approve it. There is otherwise no reason to doubt that Apiam has brought to the Court’s attention all matters that could be considered relevant to the exercise of the Court’s discretion or that there was full and fair disclosure to shareholders of all information material to the decision whether to vote for or against the scheme. I am therefore satisfied that the scheme is appropriate for the Court’s approval.

10. Apiam also seeks an order exempting it from compliance with s 411(11) of the Act. There is here no utility in having the Court order annexed to Apiam’s constitution, where the scheme will not involve any modification of any rights of Apiam’s shareholders or of creditors or persons dealing with Apiam, and there is no need to require compliance with s 411(11) of the Ac**t.

Determination and orders

11. For these reasons, I made the orders sought by Apiam at the conclusion of the second Court hearing on 6 February 2026.

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