In the matter of Infinity Pharmacy Holdings Pty Ltd (Administrators Appointed)

Cases Cited: - Hans (Administrator) Re One Steel Manufacturing Pty Ltd (admins apptd) (2025) 174 ACSR 61; [2025] FCA 219
- Owen, Re River City Motorway Pty Ltd (admins apptd) (recs and mgrs apptd) v Madden (No 4) (2012) 92 ACSR 255; [2012] FCA 1491
- RCR Tomlinson Ltd (admins apptd) [2018] NSWSC 1859
- Re BRS Quarries Australia Pty Ltd and Pleasure Point Mine Pty Ltd [2025] NSWSC 307
- Re Mosaic Brands Ltd (Admins Apptd) (Recs and Mgrs Apptd) [2024] NSWSC 1439
- Strawbridge, Re Virgin Australia Holdings Limited (admins apptd) (No 2) [2020] FCA 717

Category: Principal judgment

Parties: Daniel Mathew Bryant, Stephen Graham Longley, Mahala Rachel Hazell and Martin Francis Ford in their capacity as joint and several administrators of Infinity Pharmacy Holdings Pty Ltd (admins apptd) and the companies in the schedule (First Plaintiffs)
Infinity Pharmacy Holdings Pty Ltd (admins apptd) and the companies in the schedule (Second to Ninety-Eighth Plaintiffs)

Representation: Counsel:
J Arnott SC/F Tao (Plaintiffs)
Solicitors:
Gilbert & Tobin)

File Number(s): 2025/497061

JUDGMENT – ex tempore

Background

1. By Originating Process filed by leave on 22 December 2025, Mr Bryant and others as joint and several administrators (“Administrators”) of Infinity Pharmacy Holdings Pty Ltd (administrators appointed) and some 98 other companies identified in a Schedule applied for relief in respect of a voluntary administration of the companies, seeking orders limiting their personal liability in respect of lease arrangements of the pharmacies for a short period, and other relief in respect of their appointment to a large and complex corporate group operating individual pharmacies. I made orders allowing the relief then sought for the reasons set out in my judgment delivered on 22 December 2025.

2. Now, by Interlocutory Process filed, by leave, on 23 January 2026, the Administrators seek further relief which falls, broadly, within three categories. The first category of relief is to seek to extend the orders previously made to additional companies within the group to which the Administrators have subsequently been appointed. The second category of relief is an order extending the convening period in respect of the companies up until 27 January 2027, subject to the usual order that would allow the Administrators to convene earlier second meetings if they were in a position to do so, whether in respect of the companies generally or in respect of individual companies within the group. The third category of relief relates to funding agreements which were entered into on 23 December 2025, shortly after the Administrators’ previous application was determined, but which were not the subject of orders sought in that application.

Affidavit evidence

3. It will be convenient to deal with the affidavit evidence led in this application, before turning to the three categories of relief that is sought. The Administrators read the affidavit dated 22 December 2025 of Mr Ford, one of the Administrators, and tender the exhibits to that affidavit. That affidavit addressed the circumstances in which the Administrators were appointed in December 2025. The Administrators were appointed to numerous companies ("Section 436C Companies") by a secured creditor, which had also appointed receivers to those companies, and then to other companies ("Section 436A Companies") by the directors of the companies. Mr Ford's first affidavit also set out the group’s structure and business operations, which are complex, and noted that the companies had relatively limited head office functions, for a group of substantial size. Mr Ford also there addressed the position in respect of communications with creditors, a matter which is updated in his second affidavit in respect of this application.

4. By his second affidavit dated 21 January 2026, Mr Ford updates the position as it has developed over late December 2025 and January 2026. He refers to the first application which was brought by the Administrators and to the subsequent appointments of the Administrators to further companies within the group. That in turn prompts the application, to which I return below, to join further companies as Plaintiffs in the application. He also addresses additional complexities which have now emerged, including the fact that some of the companies were parties to partnership agreements with other companies in the group, and that the Administrators are also investigating whether the companies or some of them are the trustees of trusts which conduct the relevant businesses. Mr Ford refers to the steps which have been taken since the Administrators' appointment and since the earlier application including continuing to trade the businesses of the Section 436A Companies within the administration, and he notes that the businesses operated by the Section 436C Companies, to which receivers have been appointed, are also trading with a view to a co-ordinated sale process.

5. Mr Ford refers to communications with creditors and to a concurrent first meeting of creditors of the companies, where creditors were advised of the likelihood that this application would be made to extend the convening period, although the length of the extension that is now sought was not specifically noted at that time. Mr Ford also refers to subsequent meetings with creditors which have been held in respect of companies to which the Administrators have subsequently been appointed. He also addresses the position in respect of the leases of individual pharmacies, where the Administrators are continuing to exercise rights to occupy numerous stores under arrangements reached with relevant lessors, other than in respect of one pharmacy in Western Australia. Mr Ford also refers to the short term funding provided by two bank lenders to the group, on 23 December 2025, which prompts the application today in respect of the terms of that funding. He notes that the funding pursuant to those funding agreements was sought for urgent operating expenses, including rent and payroll, and has now been fully drawn, with the maturity date of the funding being the earlier of 16 February 2026 or the end of the administrations, unless otherwise agreed. Mr Ford also outlines the position in respect of the companies’ business and the way in which the Administrators will seek to fund the continuing operation of the business and the individual pharmacies, although complexities have arisen in respect of the delay in receipt of PBS receipts across some pharmacies.

6. Mr Ford also refers to the process contemplated for a sale or recapitalisation of the companies’ business which, broadly, contemplates a recapitalisation or the possibility of the sale of the group as a whole or in a "near-whole-of-group" transaction or, alternatively, sales of clusters or groups of stores or individual stores, where that second process would be co-ordinated with the receivers appointed to the Section 436C Companies. Mr Ford also sets out an indicative timeline for that process, which is important for the application for the extension of the convening period. He notes that it is likely to take until late March 2026 to receive final offers and, because of the regulatory regime which applies to pharmacies, both through Commonwealth and State legislation, until at least October 2026 or possibly the end of 2026 to complete the sale process, including obtaining necessary regulatory approvals for the transfer of the pharmacies. Mr Ford refers, in particular, to matters which will likely create complexities and delays in the completion of the sales of the pharmacies, namely the application of the mandatory merger control regime which commenced on 1 January 2026, which will presumably be of particular significance in respect of any whole of group or near whole of group sale, and, even if a sale takes place in respect of individual pharmacies, the need for approvals under the National Health Act 1953 (Cth) and applicable State regulation of the transfer of individual pharmacies. Mr Ford also refers to the companies’ past experience of the time taken for the sale of pharmacies, prior to the appointment of the Administrators, which indicated that the sale process of a pharmacy takes, on average, about six months, albeit there is a wide range in results, from relatively short sale processes to as long as 16 months in respect of one previous sale of a pharmacy by the group. That evidence suggests that, irrespective of whether a whole of group, near whole of group or individual pharmacy sale process is ultimately adopted, it is likely that a sale of the pharmacies would not be achieved in less than the time estimated by Mr Ford in his affidavit.

7. Mr Ford in turn undertakes a careful review of the likely impact of an extension of the convening period, particularly one of the length that is sought, upon stakeholders in the voluntary administration. He recognises that the extension of that convening period will have an impact by extending the moratorium applicable in respect of lessors, and also recognises that it has an impact on employees who would otherwise have claims under the Fair Entitlement Guarantee process, albeit few employees presently fall within that category.

8. Mr Ford expresses the view, which seems to me to be established by the evidence, that it is likely to be in the interests of creditors as a whole to extend the convening period, although I will refer below to the question whether that extension should be for the long period sought by the Administrators. That proposition seems to be straightforward, where an extension of the convening period would be necessary to bring about a sale of the relevant pharmacies, which is in turn likely to maximise the return to creditors in the voluntary administration, and the likelihood that the pharmacies will continue to operate to the potential benefit of local communities. Mr Ford also addresses the position in respect of lessors where, as I noted above, a long extension of the convening period will in turn have the consequence of a long extension of the moratorium. He notes, however, that the effect of that moratorium on creditors will be mitigated by the fact that the Administrators will continue to pay rent under leases during that period and, if a successful sale of the pharmacy is concluded, lessors may avoid the cost of vacancy and the need to re-let premises, and potentially to prove in liquidation in respect of any loss that is ultimately suffered. Mr Ford addresses the position in respect of employees, where he recognises that, at least for the several employees who have been made redundant, the extension of the convening period has a potentially adverse consequence. On the other hand, for the body of employees as a whole, it is to their advantage, so far as they continue to work in the relevant pharmacies during the relevant period, and are paid by the voluntary administrators or the receivers in respect of the Section 436C Companies, and so far as a sale of the businesses maximises the prospect of employees retaining employment with the purchasers of the relevant pharmacies.

9. Mr Ford refers to notification to creditors, where, as I noted above, creditors were advised at the first meeting of creditors that an extension of the convening period would be sought, although the length of that extension was not then exposed. Creditors have since been given notice, although only two days ago, of the length of the extension that is sought. Relevantly, some creditors who have engaged with that matter, including creditors which have representatives on the committee of inspection, and at least one sophisticated lessor of several properties, which sought copies of evidence in the application but has taken no step, at least at this point, to oppose the application.

10. Mr Ford in turn addresses the reasons for the entry into the funding agreements to which I referred above, and addresses the circumstances in which orders were not sought limiting the Administrators’ personal liability before that occurred, given the timing and urgency of the funding required. I recognise that the circumstances were unusual, where those funding agreements were executed on 23 December 2025, albeit shortly after the hearing of the Administrators' application on 22 December 2025. Mr Ford also addresses the reasons why orders are now sought limiting their personal liabilities of the administrators in that respect.

11. An exhibit to Mr Ford's affidavit evidences the timing of historical sales of pharmacies within the group, and includes a copy of information provided, initially to members of the committee of inspection and subsequently to creditors generally in respect of this application.

12. The Administrators also read the affidavit dated 23 January 2026 of Ms Dickerson, one of the receivers, in respect of the application. Ms Dickerson refers to her review of Mr Ford's affidavit; supports his analysis of the likely timing of the sale process; and identifies the reasons which she considers that the sale process would likely be complex and time consuming, including the corporate structure of companies within the group, the potential need for clearance under the mandatory merger control regime, to which Mr Ford also referred, and the need for approval under the regulatory regime applicable the transfer of a pharmacy business. Both Mr Ford and Ms Dickerson also refer to those approaches from persons interested in purchasing the pharmacies, and there is no reason to doubt that there be will be a significant level of interest in respect of the purchase of the pharmacies across the group as a whole. Ms Dickerson also confirms Mr Ford's evidence as to the intent to approach a sale of the pharmacies in a manner that involves cooperation between the Administrators and receivers in respect of the pharmacies owned by the Section 436C Companies to which receivers have been appointed.

13. The Administrators also read the affidavit dated 22 January 2026 of Ms McCoy, their solicitor, who refers to correspondence with interested parties, including the Department of Employment and Workplace Relations, which has reviewed and not expressed any disagreement with Mr Ford's evidence in respect of matters relating to employees of the companies. She also refers to communications with interested creditors, including the sophisticated lessor to which I referred above, and with the Australian Securities and Investments Commission (“ASIC”). She refers in particular, to a question raised by ASIC as to whether the Administrators would consider a shorter extension of the convening period of six months, and the response provided by the Administrators which explain the reasons why a 12 month extension of the convening period had been sought. ASIC had also raised the desirability of reserving liberty for ASIC and other creditors to apply and the Administrators seek such an order in the usual way.

14. Ms McCoy also exhibits correspondence sent by the Administrators’ solicitors to ASIC, which in turn addresses, consistent with Mr Ford's evidence, the reasons why the voluntary administrators consider that a longer extension period is necessary in this case. In particular, by an email dated 22 January 2026, ASIC referred to its concern as to the length of the extension of time that is sought, and suggested a six months extension be sought, at least in the first instance. ASIC there indicated that it did not intend to appear at the hearing today, but sought that liberty for it to apply be reserved. ASIC there indicated that the email should not be taken as an expression of support for, or opposition, to the orders sought in the application. ASIC requested that the email be drawn to the Court's attention, as the Administrators have done.

Joinder of additional Plaintiffs

15. The first category of orders sought by the Administrators, which joins additional companies to which the Administrators have been appointed as Plaintiffs in the application, and extends the orders previously made in December 2025 to those companies, is straightforward. The additional companies should be joined where the Administrators have now been appointed to the relevant companies. Their appointment to those companies raises the same issues as were raised in the December application and the orders made in December 2025 should be extended to those companies for the reasons that they were made at that time.

Extension of the convening period

16. I now turn to the question of the extension of the convening period that is here sought by the Administrators. I have addressed the relevant evidence, particularly the evidence of Mr Ford and Ms Dickerson, above. I have also recognised, as the Administrators have also recognised in submissions, the question raised by ASIC as to whether the extension that is sought should be granted for a lesser period, ASIC referring to six months, rather than the 12 months sought by the Administrators. I also bear in mind the email dated 23 January 2026 from ASIC to which I have referred above.

17. Mr Arnott, with whom Mr Tao appeared for the Administrators, drew attention to the applicable principles in respect of an extension of the convening period, which are well established and have been summarised in decisions including Strawbridge, R**e Virgin Australia Holdings Limited (admins a**pptd) (No 2) [2020] FCA 717 at [64]ff and, recently, in Re BRS Quarries Australia Pty Ltd and Pleasure Point Mine Pty Ltd [2025] NSWSC 307 at [20]ff. I bear in mind the underlying policy that the Court will seek to balance the need for an efficient and expedition administration with the desirability of maximising the result of the administration, for the benefit of creditors. I also bear in mind, as the case law has recognised, that the Court will give substantial weight to the considered judgment of voluntary administrators in matters of this kind.

18. Mr Arnott in turn refers to relevant matters, including the time needed to execute an orderly process of disposal of assets, and the time needed to develop information to be provided to creditors at a second meeting of creditors, which will likely reflect the result of any sale process or deed of company arrangement proposal; and the time needed to seek to enhance the return for unsecured creditors or preserve the relevant business. Mr Arnott also refers to case law which establishes that, at least in a proper case, a lengthy extension by the convening period may be granted, and that is not uncommon in relatively complex administrations: for example, Owen, Re River City Motorway Pty Ltd (admins apptd) (recs and mgrs apptd) v Madden (No 4) (2012) 92 ACSR 255; [2012] FCA 1491; Hans (Administrator) Re One Steel Manufacturing Pty Ltd (admins apptd) (2025() 174 ACSR 61; [2025] FCA 219. Mr Arnott also points out that this case involves many of the features which have, in other cases, justified relatively lengthy extensions of convening periods, including the likely complexity of the sale process, the existence of multiple entities within a corporate group, and the fact that the company occupies numerous leased premises which will likely need to be addressed as part of a sale process of individual parts of the business as a going concern.

19. Here, there is ultimately little doubt that an extension of the convening period for a substantial period is necessary. That conclusion follows from the evidence led by Mr Ford and by Ms Dickerson as to the steps which will be required to implement a sale process. The evidence provides no real basis to think that there is any likelihood that a sale process could be completed in, for example, six months given the time that is likely required to identify preferred bidders and then to complete the sale process, or a deed of company arrangement, whether in respect of a whole of business sale, or the sale of multiple groups of pharmacies or individual pharmacies across the group.

20. I bear in mind ASIC's preference for a shorter extension period, but it seems to me that that preference largely reflects the uncontentious proposition that, all things being equal, a shorter voluntary administration would be preferable to a longer voluntary administration, a proposition that the Administrators accept. However, the real question here is whether, as a matter of fact, the Administration could realistically complete a recapitalisation, sale or a deed of company arrangement in less than 12 months, to allow a second meeting of creditors to occur in a way that was consistent with maximising the sale proceeds of the business and providing useful information to creditors at that second meeting. It seems to me that the Administrators' evidence, supported by Ms Dickerson, suggests that that is not likely and that a longer extension of time, for the full period that is sought, is preferable.

21. First, and importantly, that will allow an ordered sale process, in a way that seems to be consistent with maximising competition between purchasers, and maximising the proceeds which will be obtained from that sale process, by leaving open the several alternatives of a recapitalisation or a sale of the business as a whole, or a substantial part of the business, or ultimately individual pharmacies. Second, as Mr Arnott points out, there is little utility in ordering an extension of time for six months, where the evidence does not suggest that a sale or deed of company arrangement will be achieved within six months. The consequence of taking that course would simply be to put the companies to the cost of a second extension application and, possibly more significantly, would potentially undermine attempts to achieve a sale or deed of company arrangement across the group or for groups of companies or individual companies, because purchasers of the pharmacies could not be confident that the necessary steps to completion would be completed in the time then available.

22. I have borne in mind that, for those employees who have been made redundant, the long extension of the convening period will be disadvantageous, so far as it delays access to the Fair Entitlement Guarantee Scheme. I also bear in mind that they are relatively small in number, although the detriment to them is real, albeit possibly mitigated to the extent that inventory can be realised, and their entitlements discharged by the receivers from the proceeds of realisation. In any event, the position of those employees must be borne in mind, but weighed against the position of creditors and other stakeholders as a whole.

23. I also bear in mind that, as Mr Arnott points out, the liberty to apply which ASIC proposed, and which the Administrators have sought, will allow ASIC or creditors to bring an application, if events develop so as to warrant earlier meetings of creditors, in respect of the companies as a whole or individual companies. The orders sought by the Administrators will also allow the Administrators themselves to convene earlier meetings of creditors, in respect of the companies as a whole or particular companies, if matters are progressed in respect of the company as a whole or particular companies in a shorter period.

24. For these reasons, I am satisfied that I should make the orders sought in respect of the extension of the convening period, and that I should make them for the full period sought, where there is no practical utility in extending a time for less than is practically required to implement the steps to which the Administrators and receivers refer.

Funding agreements

25. I can address the question in respect of the variation sought under s 447A of the Act in respect of the funding agreements more briefly, where the position is relatively straightforward. The case law recognises that the Court has power, under s 447A of the Act, to make orders limiting the administrators' personal liability under s 443A of the Act, and will typically do so where such orders are likely to advance the interests of the companies. In RCR Tomlinson Ltd (admins apptd) [2018] NSWSC 1859 at [11], I observed that such an order may typically be made where it is in the interests of the companies that a borrowing take place, and where administrators could not fairly be expected to assume unlimited personal liability for the borrowing, or the risk that their indemnity against the company’s assets is ultimately not sufficient to discharge that borrowing. I adopted the same approach in Re Mosaic Brands Ltd (Admins Apptd) (Recs and Mgrs Apptd) [2024] NSWSC 1439 at [14].

26. Here, it seems to me that the relevant borrowings were plainly in the companies’ interests, so far as they were intended to fund their continued trading and the payment of the employees in the period immediately after the appointment of the Administrators, including over the Christmas and vacation period. The Administrators could not fairly have been expected to assume personal liability for the borrowing, although the amount of the borrowing was here limited, where they were unfunded at the time of their appointment.

27. I recognise that, unusually, the Administrators here entered into the relevant funding agreements before seeking the orders under s 447A of the Act. That, however, reflected a proper recognition, on their part, of the urgency of the relevant circumstances, and the fact that the agreements had to be entered into immediately before the Christmas period, having been executed with both financiers on 23 December 2025. It is understandable, and indeed to the Administrators' credit, that they did not then seek to defer the entry into the funding agreements to bring an application to the Court immediately before Christmas to protect their liability position. It seems to me that the Court would have made the orders sought, had the application been brought at that time. I should make those orders now, where those orders will give effect to the commercial arrangement which has been reached between the Administrators and the bank lenders, which contemplate that the liability of the Administrators will be limited in a manner consistent with the order that is now sought under s 447A of the Act. For those reasons, I will make the orders that are sought in respect of the funding agreements.

Orders

28. For these reasons, I make orders in accordance with the short minutes of order sought by the Administrators, omitting paragraph 17 and varying paragraph 18 so that it provides that the exhibits are returned.

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