• Lawyers in Sydney
• Lawyers in Melbourne
• Lawyers in Brisbane
• Lawyers in Perth
• Family lawyers
• Employment lawyers
• Criminal lawyers
• Wills and estates lawyers
• Find a lawyer

Category: Principal judgment

Parties: SDI Limited (Plaintiff)
Beijing Guoci Kebo Technology Co Ltd (Bidder)
InnoXvest Dental Pty Ltd (Bidder Sub)

Representation: Counsel:
Ms B Ng (Plaintiff)
Mr T O’Brien (Bidder / Bidder Sub)
Solicitors:
DLA Piper (Plaintiff)
Herbert Smith Freehills Kramer (Bidder / Bidder Sub)

File Number(s): 2026/177319

Judgment

1. By Originating Process filed on 30 April 2026, the Plaintiff, SDI Limited (“SDI”) applies for orders under ss 411 and 1319 of the Corporations Act 2001 (Cth) (“Act”) relating to a proposed scheme of arrangement and associated orders. I made the orders sought by SDI at the conclusion of the hearing on 18 May 2026, for the reasons set out in my judgment in Re SDI Limited [2026] NSWSC 662. The scheme was then approved by the requisite majorities of SDI shareholders at the scheme meeting held on 22 June 2026 for the purposes of s 411(4)(a)(ii) of the Act.

2. At this second Court hearing, SDI seeks orders approving the scheme. No SDI 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 SDI at the conclusion of this hearing. These are my reasons for making those orders, and I have drawn on the helpful submissions of Ms Ng who appeared for SDI in this judgment.

Affidavit evidence

3. SDI read the affidavit dated 23 June 2026 of Mr John Slaviero, its Chief Operating Officer and Director of Finance. Mr Slaviero referred to registration of the scheme booklet with the Australian Securities and Investments Commission (“ASIC”); the despatch of scheme materials to SDI shareholders; the operation of a shareholder information line which received only three uncontroversial calls; the conduct of the scheme meeting at which the scheme resolution was passed by substantial majorities; the voter turnout at the scheme meeting which exceeded the number of shares and number of shareholders who had voted at SDI’s recent annual general meetings; and the satisfaction of the conditions precedent to the proposed scheme. SDI also tendered a letter dated 23 June 2026 from ASIC indicating that it had no objection to the proposed scheme under s 411(17)(b) of the Act and a conditions precedent certificate indicating satisfaction of relevant conditions precedent to the scheme.

Applicable principles

4. I summarised the matters which will be considered by the Court at a second Court hearing of a scheme 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], to which Ms Ng referred, 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

5. I am satisfied that SDI complied, in substance, with the Court’s orders in respect of the distribution of scheme documents to its shareholders, although there was a short and immaterial delay in despatch of the scheme documents which plainly caused no detriment to shareholder and provides no reason not to approve the scheme. The scheme booklet and convening orders were lodged with ASIC; the despatch of the scheme materials to SDI shareholders and the conduct of the scheme meeting is addressed in the evidence; and the scheme resolution was passed by the statutory majorities. SDI 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 SDI’s recent annual general meetings and there is no reason to think there was any defect in the notice of the scheme given to SDI shareholders.

6. The other statutory requirements for the scheme have been satisfied. The scheme was here recommended by SDI’s board and the independent expert expressed the view that the scheme was in the best interests of SDI shareholders in the absence of a superior proposal. There is no reason to doubt that the scheme is fair and reasonable so that an intelligent and honest SDI shareholder, properly informed and acting alone, might approve the scheme. There is otherwise no reason to doubt that SDI has brought all matters that could be considered relevant to the exercise of the Court’s discretion to the Court’s attention or to doubt 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.

7. SDI 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 SDI’s constitution, where the scheme will not involve any modification of any rights of SDI’s shareholders or of creditors or persons dealing with SDI, and there is no need to require compliance with s 411(11) of the Ac**t.

Determination and orders

8. For these reasons, I made the orders sought by SDI at the conclusion of the second Court hearing on 24 June 2026.

**********