RE NAVITAS LTD; EX PARTE NAVITAS LTD [2019] WASC 180 (24 May 2019)

1. Navitas relied on seven affidavits from five deponents. Those deponents were:

(1) David Roger Davies: Mr Davies is a solicitor acting for Navitas. He affirmed affidavits on 24 April and 7 May 2019. Those affidavits addressed various ASX announcements and formal matters such as Navitas' constitution, annual report and a recent company search. Mr Davies also attached the first two versions of the draft scheme booklet and various communications with the Australian Securities and Investments Commission (ASIC).

(2) Tracey Horton AO: Ms Horton is a nonexecutive director and the chair of the board of directors of Navitas. She affirmed an affidavit on 3 May 2019. Ms Horton provided an overview of the scheme proposal and explained the historical dealings between Navitas and the BGH Consortium. Otherwise, so far as Ms Horton was proposed as the chairperson of the scheme meetings, Ms Horton made the necessary disclosures under r 3.2 of the Supreme Court (Corporations)(WA) Rules 2004 (WA).

(3) Antoni Cipa: Mr Cipa is a nonexecutive director of Navitas and the proposed alternate chairperson of the scheme meetings. He too provided an affidavit, affirmed 3 May 2019, making the necessary disclosures in accordance with r 3.2.

(4) Matthew Rumpus: Mr Rumpus is the assistant company secretary and senior legal counsel of Navitas. He affirmed an affidavit on 7 May 2019. Among other things Mr Rumpus explained the process undertaken to verify the Navitas information as contained in the draft scheme booklet.

(5) Rowan Krasnoff: Mr Krasnoff is a solicitor in Mr Davies' team acting for Navitas. He affirmed two affidavits on 9 May 2019. Mr Krasnoff provided proposed email notifications to shareholders, copies of further communications with the ASIC and marked up and final versions of the scheme booklet including the independent expert report (IER).

1. BGH BidCo also filed an affidavit. This was relied on by Navitas. That affidavit, the affidavit of Haroula Morfis affirmed 9 May 2019, confirmed the verification process for information attributable to BGH BidCo as appearing in the scheme booklet. In addition to attaching a Co-Investment Agreement, as between BGH BidCo and the BGH Consortium members, the affidavit attached an executed deed poll as contemplated by the SID so as to ensure the better effectuation of the terms of the proposed scheme of arrangement.
2. Based on that affidavit evidence I record the following matters.
3. Navitas was incorporated on 18 June 2004 and later that year was admitted to the official list on the ASX. Navitas' ordinary shares are listed for quotation. As at the close of trading on the ASX on 2 May 2019 Navitas had 358,251,068 shares on issue.
4. Navitas is described as a global education provider.
5. Navitas operates more than 120 colleges and campuses across 33 countries. These are primarily located in Australia, the United States of America, Canada, the United Kingdom and continental Europe. Navitas operates from a Perth head office and employs approximately 7,000 staff globally. Its educational services are offered through two main reporting divisions: 'university partnerships' and 'careers and industry'. Navitas provides a range of services including pre-university and university programs, English language courses, migrant education and settlement services, creative media education, student recruitment, professional development and corporate training.
6. The BGH Consortium has been established by a private equity firm known as BGH Capital.
7. BGH BidCo is an Australian proprietary company. BGH BidCo is a special purpose vehicle that was incorporated for the sole purpose of acquiring the Navitas shares. It is proposed that BGH BidCo will ultimately be owned and controlled by the BGH Consortium through another holding company, BGH HoldCo A Pty Ltd (BGH HoldCo). At the time of implementation of the proposed scheme of arrangement, if approved, BGH BidCo and BGH HoldCo intend to implement a corporate structure such that BGH HoldCo will be owned in particular proportions by members of the BGH Consortium.
8. The BGH Consortium, together with BGH BidCo, are parties to a Co-Investment Agreement dated 21 March 2019 which regulates their participation in the scheme proposal.
9. The members of the BGH Consortium are:

(1) BGH Fund (in relation to which BGH Capital is manager or adviser to each of the constituent entities) - to hold 31.14% of BGH HoldCo;

(2) Rodney Jones and two entities owned and controlled by Mr Jones, namely, Hoperidge Enterprises Pty Ltd and Remjay Investments Pty Ltd (they are known collectively as 'RMJ') - to hold 10.27% of BGH HoldCo;

(3) AustralianSuper Ltd in its capacity as trustee for AustralianSuper - to hold 13.06% of BGH HoldCo;

(4) British Columbia Investment Management Corporation - to hold 11.75% of BGH HoldCo;

(5) Sinspec Investment Pte Ltd - to hold 11.02% of BGH HoldCo;

(6) Canada Pension Plan Investment Board (CPPIB) - to hold 11.02% of BGH HoldCo; and

(7) Ontario Teachers' Pension Plan Board - to hold 11.75% of BGH HoldCo.

1. Three members of the BGH Consortium are existing shareholders of Navitas: RMJ, AustralianSuper and CPPIB.
2. Mr Jones was a founder of Navitas. Until June 2018 he was the managing director of Navitas. In circumstances recounted below Mr Jones resigned as a director of Navitas on 7 November 2018. RMJ (Mr Jones and the two companies associated with him) hold approximately 12.6% of the Navitas shares on issue. This comprises 34,711,843 Navitas shares held by Remjay Investments Pty Ltd, 9,586,690 Navitas shares held by Hoperidge Enterprises Pty Ltd as trustee for the Jones Family Trust and 819,462 Navitas shares held by Hoperidge Enterprises Pty Ltd on behalf of a superannuation fund.
3. AustralianSuper holds a beneficial interest in 19,401,870 Navitas shares (approximately 5.4% of the Navitas shares on issue) and CPPIB holds a legal and beneficial interest in 737,600 Navitas shares (approximately 0.2% of the Navitas shares on issue).
4. It is necessary to provide a fuller explanation of the circumstances in which Navitas and BGH BidCo came to execute the SID in midMarch 2019.
5. On 8 October 2018 an 'Initial Consortium' entered into a Cooperation and Process Agreement (COPA) (attachment 'DRD-7'). The Initial Consortium comprised BGH Capital, RMJ and AustralianSuper. By the COPA the Initial Consortium agreed to work together on an exclusive basis to consider, negotiate and implement a proposal for the acquisition of all Navitas shares.
6. The COPA represented an impediment to the emergence of competing proposals for the acquisition of all Navitas shares.
7. RMJ and AustralianSuper owned approximately 18% of the Navitas shares on issue. By the COPA, RMJ and AustralianSuper were prohibited from being involved in, accepting, voting in favour of or otherwise supporting a competing proposal to acquire all of the shares in Navitas (cl 4.1, cl 4.2). Rather, RMJ and AustralianSuper were bound to vote against any competing proposal (cl 4.2). RMJ also agreed that it would vote in favour of a scheme of arrangement to effect the Initial Consortium's proposal (cl 6).
8. The exclusivity period under the COPA potentially extended for nine months (although, depending on the events that happened, the exclusivity period may end earlier).
9. Accordingly, a significant block of Navitas shares were contractually committed to supporting the Initial Consortium's proposal; and, in any case, to vote against any competing proposal. That was the position even if a competing proposal were to deliver superior value to Navitas' shareholders generally.
10. The papers before me record that when this became known to Navitas' board it became concerned that the exclusivity restrictions assumed by RMJ and AustralianSuper under the COPA were a potential impediment to the emergence of any competing proposal for control of Navitas. That concern was confirmed when the board, with the aid of Navitas' financial adviser, explored with a number of other parties whether they could present an alternative change of control proposal for Navitas. Essentially, the restrictions in the COPA affecting RMJ and AustralianSuper impeded the likelihood that Navitas might attract a superior competing proposal to that of the Initial Consortium.
11. On 9 October 2019 Navitas received a first indicative proposal from the Initial Consortium. The terms contemplated the acquisition of all of Navitas' issued shares for a consideration of either:
    • $5.50 cash per share; or, at the member's election
    • $2.75 cash per share plus, for every two shares held by the member, one ordinary share in a newly formed unlisted company that would own Navitas.
12. On receipt of the first indicative proposal Navitas announced that, given Mr Jones' involvement in the Initial Consortium, the Navitas board was putting in place formal protocols in relation to Mr Jones' access to information, employees and attendance at board meetings of Navitas.
13. In her affidavit Ms Horton explained that, while Mr Jones remained a Navitas director, as at 9 October 2018 Mr Jones had been on a leave of absence from the board since 1 July 2018. That leave of absence continued until 7 November 2018 when Mr Jones resigned as a director of Navitas. During this time Mr Jones did not attend Navitas board meetings. Nor was Mr Jones involved in the consideration of, or response to, the first indicative proposal. Mr Jones' non-involvement, on behalf of Navitas, in responding to the Initial Consortium and the BGH Consortium has remained the case through the latter proposals and the scheme process generally.
14. The Navitas board embarked on a review of the first indicative proposal. During that time there was a further indicative proposal from the Initial Consortium, but again at a price of $5.50 per Navitas share. On 12 November 2018 Navitas issued an announcement rejecting the proposal.
15. The 12 November 2018 announcement stated:

Navitas ... announces that it has received a further indicative, preliminary, nonbinding and conditional proposal from the BGH Consortium to acquire 100% of the outstanding shares in Navitas by way of scheme of arrangement. The price offered by the BGH Consortium has not changed; they have reaffirmed a price of $5.50 cash per Navitas share ...

The Board of Navitas remains of the view that the Proposal is significantly below its assessment of value, having regard to the medium and longer term potential of Navitas. As such, it has concluded that pursuing the indicative proposal in its current form would not be in the best interests, of all Navitas shareholders.

...

The Cooperation and Process Agreement [the COPA] remains in place, an important effect of which is to bind AustralianSuper and Mr Rodney Jones to vote against any competing proposal, even if it were to deliver superior value to all other Navitas shareholders. The Navitas Board is not inclined to provide due diligence to any party who places restrictions on Navitas shareholders from supporting a superior alternative proposal.

The Board is exploring with a number of parties whether they could present an alternative change of control proposal, or any other transaction that has the potential to be materially value enhancing for all Navitas shareholders. A number of these parties have confirmed the Board's view that the commitments by AustralianSuper and Mr Jones are potentially an impediment to proceeding with any competing proposal.

1. At that time Navitas did not afford the Initial Consortium the opportunity to perform due diligence in relation to its further indicative proposal.
2. On 14 January 2019 Navitas received a revised proposal from the Initial Consortium. This contemplated an increased acquisition price of $5.825 per share (an increase of 32.5 cents per share or 5.9%). The revised proposal also stated that the Initial Consortium was reconsidering the suitability of the cash and unlisted scrip alternative as outlined in the earlier proposals; and whether the scrip alternative should be offered to all shareholders in addition to RMJ and AustralianSuper.
3. The reconsideration followed (and, I infer, was informed by) the ASIC's issue on 13 December 2018 of media release 18376MR entitled 'ASIC to consult on measures to restrict offers to retail investors of stubequity in proprietary companies'. In that media release the ASIC stated:

ASIC is concerned about recent control transactions where part or all of the consideration includes stubequity in Australian proprietary companies. These offers of stubequity have been made to a large and diverse group of target shareholders, including retail investors.

Proprietary companies are required to be closely held and are prohibited from making broad public offers of their shares. By structuring control transactions to avoid these restrictions, retail investors who accept scrip consideration miss out on the disclosure and governance protections that apply to public companies, but from which proprietary companies are exempt.

We intend to issue a consultation paper in early 2019 seeking views on a proposed legislative instrument to prevent these kinds of offers in controlled transactions.

We may also consider making individual instruments to prevent these offers where the control transaction is announced after the date of this media release but prior to the conclusion of our consultation.

1. On 15 January 2019 Navitas announced that it intended to recommend the revised proposal to shareholders subject to certain conditions (eg no superior offer emerging and an independent expert concluding that the revised proposal was in the best interests of Navitas' shareholders). To that end the BGH Consortium was to be granted exclusive due diligence for a limited period. However, that right was subject to no superior proposal emerging that the BGH Consortium did not match. Importantly, Navitas' agreement to afford due diligence to the BGH Consortium was dependent on a negotiated mechanism whereby RMJ and AustralianSuper could support a superior proposal should one emerge which was not matched by the BGH Consortium. That potentiality was effected by cl 15 of a Process and Confidentiality Deed dated 14 January 2019 (included in the papers before me as attachment 'TAH3') which provided for selfexecuting amendments to the restrictions in the COPA in the event of a binding superior proposal which was not matched.
2. The draft scheme booklet explains the Navitas board's reasoning for its actions in these terms (par 1.2(e)):

The Navitas Board required, as a prerequisite to granting due diligence access to the Consortium and pursuing the Revised Proposal, a suitable lifting of that impediment [under the COPA] (so as to restore a competitive market for control of Navitas, in the interests of all Navitas Shareholders). Accordingly, the Navitas Board successfully negotiated and agreed with the Initial Consortium that those restrictions would be lifted in the event that Navitas received a Superior Proposal, the Consortium did not match that proposal within the agreed timeframe, and the Superior Proposal became binding prior to 2 April 2019.

That agreement continued under an amended deed executed simultaneously with the Scheme Implementation Deed, the effect of which was to remove those restrictions, for a reasonable window, so as to allow any superior competing proposal that emerged during that time and that would have maximised value for all Navitas Shareholders to not be unduly impeded by the Initial Consortium's Cooperation and Process Agreement.

1. Senior counsel for Navitas submitted, and I accept, that Navitas successfully defused the effect of the exclusivity restraints imposed by the COPA for a reasonable window (a period of 14 January to 2 April 2019). I also accept that, faced with the COPA and the impediment it presented to a competing proposal for control of Navitas by an acquisition of its shares, the Navitas Board acted prudently in negotiating and obtaining the benefit provided by cl 15 of the Process and Confidentiality Deed.
2. The lockup of RMJ and AustralianSuper through the exclusivity arrangements under the COPA might have prevented the emergence of a superior offer but for the revised arrangements negotiated by Navitas. Whether, but for the revised arrangements, that might have had implications for approval of a proposed scheme (or convening meetings of members to consider a proposed scheme) is not something that arose for consideration on the application before me. I was able to examine the scheme of arrangement as proposed cognisant of the circumstance that commercially prudent steps had been taken by Navitas' Board to restore a competitive market for control of Navitas.
3. There was no competing proposal. On 21 March 2019 Navitas and BGH BidCo entered into the SID. In an ASX announcement issued the same day it was said that:
   • Navitas has agreed terms of a binding offer from the BGH Consortium, under which the BGH Consortium will acquire 100% of the share capital of Navitas by way of Scheme of Arrangement.
   • Navitas shareholders to receive Cash Consideration of $5.825 per Navitas share upon the Scheme being implemented.
   • Navitas Directors unanimously recommend Navitas shareholders vote in favour of the Scheme, in the absence of a Superior Proposal, and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Navitas shareholders.
4. Accordingly, Navitas' directors unanimously recommend that the Navitas shareholders vote in favour of the proposed scheme in the absence of a superior proposal. No competing proposal has emerged. In her affidavit Ms Horton deposes that she does not have any basis to believe that any superior proposal will be forthcoming. That belief is justified. The window to lift the restrictions affecting RMJ and AustralianSuper under the COPA has now closed. The restrictions under the COPA - and their potential impediment to the emergence of a competing proposal - will now remain in place until 30 September 2019.
5. The directors' recommendation is, however, subject to an independent expert opining that the scheme is in the best interests of Navitas shareholders. As will be seen, that has occurred.

1. The proposed scheme contemplates that BGH BidCo will acquire all of the issued ordinary shares in Navitas (cl 2(e), cl 4.2, cl 5.1).
2. Navitas' shareholders will be entitled to receive the scheme consideration in respect of their shares (cl 5). This comprises:
   • for RMJ and AustralianSuper - a 'mixed consideration' as explained at par 45 below (cl 5.3(a)); and
   • for all other shareholders - a cash consideration of $5.825 per share (cl 5.3(b)).
3. The scheme booklet gives details of the funding available to BGH BidCo to meet the scheme consideration (par 6.4). BGH BidCo has entered into legally binding equity commitment letters (up to A$1.09 billion) and a legally binding debt commitment letter (up to A$1.45 billion). That debt and equity funding is intended to fund the scheme consideration, the refinancing of certain existing debt facilities of the Navitas group and various related transactions and costs.
4. Within the terms of the proposed scheme of arrangement RMJ and AustralianSuper are described as 'Relevant Shareholders'. Elsewhere they are referred to as 'Consortium Shareholders'. I will use both terms interchangeably. By cl 5.3(b) of the scheme, where they make an election accordingly, the Relevant Shareholders are to receive a mixed consideration for their Navitas shares comprising:
   • a certain number of ordinary shares (4.459 ordinary shares for each Navitas share) and preference shares (1.366 preference shares for each Navitas share) in BGH HoldCo for the Navitas shares the subject of an election to receive the scheme consideration in such BGH HoldCo shares; and
   • $5.825 for each Navitas share the subject of an election to receive the scheme consideration in cash.
5. Outside of the scheme, however, RMJ and AustralianSuper, as Consortium Shareholders, have already committed to make particular elections.
6. By an instrument called the 'CoInvestment Agreement' dated 21 March 2019 (attachment 'HNM3'), RMJ and AustralianSuper have binding contractual commitments, in favour of the BGH Consortium, to exchange certain proportions of their Navitas shares for BGH HoldCo shares. As disclosed in the scheme booklet, RMJ must exchange 53.2% of its Navitas shares for BGH HoldCo shares; AustralianSuper must exchange 99.8% of its Navitas shares for BGH HoldCo shares. Only the remaining balance will be the subject of an election to receive the cash consideration of $5.825 per Navitas share.
7. RMJ and AustralianSuper are also obliged, under the CoInvestment Agreement, to vote in favour of the proposed scheme of arrangement.
8. On effectuation of the proposed scheme Navitas will become a wholly owned subsidiary of BGH BidCo. Navitas will then be delisted from the ASX (cl 7). However, the scheme will not become effective unless and until a number of conditions are satisfied (cl 3.1). This includes the satisfaction or waiver of numerous conditions precedent in cl 3.1 of the SID. The nature of the various conditions precedent are fully disclosed in the draft scheme booklet (scheme booklet, par 3.7 and Annexure 'A').
9. Ms Horton deposes to the effect that one of the significant conditions precedent has been waived. Otherwise Ms Horton deposes that she is not aware of anything that has resulted in, or is likely to result in, the failure of any of the conditions precedent.
10. The SID contemplates that Navitas will obtain an independent expert report.
11. The IER has been provided by Nathan Toscan and Julie Planinic of Lonergan Edwards & Associates Ltd. The independent experts consider that the advantages of the proposed scheme outweigh the disadvantages. In the independent experts' view, the acquisition of Navitas shares by BGH BidCo under the scheme is fair and reasonable and in the best interests of the Navitas shareholders in the absence of a superior proposal. In coming to that conclusion the independent experts determine the valuation range for Navitas shares on a 100% controlling interest basis as being between $5.60 per share (low) to $6.15 per share (high) with a midpoint of $5.875 per share.
12. Accordingly, the scheme consideration of $5.825 per share is within the assessed valuation range as determined in the IER. It is on that basis that the independent experts opine that the scheme is fair and reasonable and in the best interests of Navitas' shareholders in the absence of a superior proposal.
13. In recommending that, in the absence of a superior proposal, Navitas shareholders vote in favour of the scheme, the Navitas board have formed the view that the scheme is in the best interests of Navitas shareholders for three main reasons:

(1) First, because the IER has concluded that the scheme is fair and reasonable and in the best interests of the shareholders in the absence of a superior proposal.

(2) Second, the offer price of $5.825 cash per share is said to represent certain value, at a significant premium, for Navitas shares.

(3) Third, following the first indicative proposal Navitas pursued discussions with a number of other parties about whether they could present an alternative change of control proposal. No superior proposal emerged. This is said to support the directors' view that the offer price represents a fair realisable value of the Navitas shares.

1. As to the directors' second reason, the materials before me record the extent to which the offer price represents a premium over the trading price for Navitas shares on the ASX before 9 October 2018 (that being the last trading day before the announcement of the first indicative proposal). The offer price is a 33.9% premium over the $4.35 closing price on 9 October 2018. It is a 33.3% premium to the one month volume weighted average price to 9 October 2018 and a 32.7% premium to the three month volume weighted average price to 9 October 2018.
2. I was provided with the initial draft version of the scheme booklet as provided to the ASIC on 17 April 2019 (attachment 'DRD6') and the various amendments that were made to the document following consultation between the ASIC and Navitas' legal advisers (attachments 'DRD18', 'RRK9' and 'RRK11'). At the hearing Navitas relied on a final version of the draft scheme booklet dated 9 May 2019 (attachment 'RRK11').
3. The scheme booklet itself comprises sections as follows:
   • Important dates and expected timetable for the scheme.
   • Letter from the chairperson of Navitas.
   • Important notices.
   • Considerations relevant to your vote.
   • Frequently asked questions.
   • Summary of the scheme.
   • How to vote at the scheme meetings.
   • Information relating to Navitas.
   • Information relating to BGH BidCo, BGH HoldCo and the BGH Consortium.
   • Risks.
   • Taxation implications.
   • Implementation of the scheme and other aspects of the transaction.
   • Additional information concerning the scheme.
   • Glossary.
4. The scheme booklet will be accompanied by substantial attachments which form part of the scheme booklet. These will include the final IER. Also attached will be a summary of the terms of the SID, a copy of the executed deed poll (refer to pars 98 - 100 below), the terms of the scheme of arrangement and the notices of meeting to the Navitas general shareholders and the Consortium Shareholders.

1. I described the applicable legal framework for an application of the nature brought by Navitas in Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd.[1] I do not intend to repeat what I stated in Re Wesfarmers Ltd. I adopt and will apply what I stated in Re Wesfarmers Ltd.
2. There is usually said to be six matters to be proved at this first stage of the process under s 411 of the Act. Those matters are that:

(1) The plaintiff is a part 5.1 body.

(2) The proposed scheme is a compromise or arrangement within the meaning of s 411 of the Act. Here, relevantly, the question is whether the proposed scheme is an 'arrangement'.

(3) The proposed scheme booklet will provide proper disclosure.

(4) The scheme is bona fide and properly proposed. (For present purposes it is convenient, by reference to this heading, to also consider the lawfulness and any class issues in relation to the proposed scheme of arrangement. As will be seen, there is a class issue as to the proposed scheme.)

(5) The ASIC has had at least 14 days' notice of the proposed hearing date and has had a reasonable opportunity to examine the terms of the scheme and the scheme booklet and to make submissions.

(6) The various procedural requirements of the Act and the Supreme Court (Corporations) (WA) Rules 2004 (WA) have been met.

1. It is also necessary that the court is satisfied that the scheme is of such a nature and cast in such terms that, if it receives a statutory majority at the scheme meetings, the court would be likely to approve the scheme at a hearing of an application which is unopposed. This does not require me to descend into the commercial merits or demerits of Navitas' proposed scheme. It is enough if the scheme is such that it would be open to the members of Navitas to adopt. I need only consider whether the proposed scheme is one that sensible business people might consider to be of benefit to the members.
2. There are some other specific legal considerations that apply to the scheme of arrangement as proposed by Navitas. Those matters were drawn to my attention by senior counsel for Navitas in its written submissions and at the oral hearing. It is convenient to defer consideration of those matters and deal with them in providing my reasons for the orders as made.

1. The formal matters that Navitas had to prove are satisfied.
2. Navitas is a company; it is therefore a pt 5.1 body. The proposed scheme constitutes an 'arrangement'. This type of share acquisition scheme has been approved by courts as an arrangement on numerous occasions.
3. By letter dated 9 May 2019 (attachment 'RRK12' to Mr Krasnoff's first 9 May 2019 affidavit) the ASIC confirmed satisfaction of the service requirement and that it had been provided with the reasonable opportunity required under s 411(2). The ASIC also gave notice that it did not propose to appear to make submissions or intervene to oppose the scheme at the first hearing.
4. The various procedural requirements for making the orders were all attended to in the evidence; for example, there were the necessary consents and disclosures by the proposed chairperson of the meetings and her alternate.

1. On the materials before me there was nothing to suggest that the proposed scheme was unlawful or not properly proposed. In particular, there was no obvious flaw in the proposed scheme such that it would be inappropriate for the scheme to be submitted to Navitas' shareholders for their consideration.
2. Navitas proposed, and I accepted, that given the terms of the proposed scheme there were two relevant classes of shareholder; and accordingly there should be two shareholders' meetings, differently constituted, to consider approval of the scheme.
3. The first class of shareholder are the Consortium Shareholders, RMJ and AustralianSuper. The Consortium Shareholders constitute a different class as they may elect to receive the mixed consideration rather than the $5.825 cash per share. The shareholders other than the Consortium Shareholders constitute the second class of shareholder. I accept that the differential scheme consideration offered to the Consortium Shareholders and the other shareholders means that there is insufficient community of interest between all shareholders for all shareholders to consider whether the scheme is in their collective interests. The different scheme consideration on offer means that the Consortium Shareholders have a different interest than the other shareholders and therefore constitute a separate class to the other shareholders.
4. I appreciate that it is necessary to avoid providing for too many classes. If too strict an approach is applied it may, on occasions, allow a small group of members to stymie what is otherwise to the collective benefit of all shareholders. Here, however, that risk is more theoretical than real. The Consortium Shareholders are contractually obliged to support the scheme proposal in any event.
5. Allowing the general shareholders to vote as a class, excluding the Consortium Shareholders, will permit the general shareholders to come to a collective view independent of the circumstance that the Consortium Shareholders will be provided with a right to elect to receive the mixed consideration. It has the collateral benefit that the general shareholders' collective view can be determined independent of the contractual restrictions which will apply to the Consortium Shareholders' expression of approval of the scheme.

1. I have read through the initial draft of the scheme booklet (as provided to the ASIC) - including its various attachments and the IER and considered the amendments which are now reflected in the final scheme booklet and the amended IER. I was and am satisfied, to the necessary prima facie level given the interlocutory nature of the application before me, that there will be proper disclosure as to the effect of the proposed scheme and the material considerations to which shareholders ought to have regard.
2. Importantly, the scheme booklet gives disclosure as to the reasons that a shareholder may wish to vote against approval of the proposed scheme (par 1.3). There is also a comprehensive section on the risk factors, both general and specific, associated with the proposed scheme (par 7).
3. I have been provided with the communications between the ASIC and Navitas' legal representatives consequential upon the ASIC's review of the contents of the draft scheme booklet. This resulted in a number of changes to the scheme booklet which enhanced disclosure.
4. In particular, the ASIC sought and Navitas has made additional disclosures as to:

(2) the nature of the mixed consideration that will be available to the Consortium Shareholders;

(3) risk factors relevant to the Consortium Shareholders so far as they elect to receive the mixed consideration; and

(4) fees and expenses expected to be incurred by Navitas in connection with the scheme.

1. I note that, while Navitas' directors unanimously recommend that shareholders vote in favour of the scheme, that is on the proviso that there is no superior proposal and that the independent experts continue to conclude that the scheme is in the best interests of Navitas' shareholders. Navitas' directors have also expressly declined to make any recommendation in respect of the mixed consideration. That election has been left entirely up to the Consortium Shareholders.
2. The final version of the scheme booklet offers the following reasons for making no recommendation in terms of the mixed consideration (par 1.5):
   • The mixed consideration is only offered to four shareholders each of whom is a BGH Consortium member and a sophisticated or professional investor.
   • Each of the Consortium Shareholders has already agreed to elect to receive the mixed consideration in particular proportions - meaning that any recommendation will not be factored into the Consortium Shareholders' decision making.
3. In short, the Consortium Shareholders are best placed to determine themselves - and have already so determined - whether or not to elect to receive the mixed consideration; and, if so, in what proportion to elect to receive the mixed consideration.
4. In written submissions senior counsel for Navitas acknowledged that the scheme booklet did not provide the level of disclosure concerning the election for Consortium Shareholders as might be found in an 'all scrip' transaction. However, it was also submitted, and I accept, that the proposal was not one where 'stub-equity' was being offered to shareholders generally. Thus, according to the submission, the concerns expressed in the ASIC media release, and considered in cases such as Re Capilano Honey Ltd,[2] were not relevant.
5. It is not necessary for me to come to a conclusion on whether it might have been desirable that the Navitas board offer a recommendation to the Consortium Shareholders. In my view, despite the absence of any such recommendation, there is adequate information provided by the scheme booklet for the Consortium Shareholders to come to a fully informed decision as to whether it is in their interests to accept the scheme proposal. In this regard, at the ASIC's urging, the independent experts augmented the IER to address the likely market value of the BGH HoldCo shares to be issued to the Consortium Shareholders immediately postimplementation of the scheme. The independent experts concluded that the market value of the BGH HoldCo shares to be issued in lieu of the $5.825 cash ought to be no greater than the $5.825. Detailed reasons for that view are provided in pars 29 and 240 of the IER.
6. The contents of the scheme booklet remain a matter for Navitas. That said, the detailed nature of ASIC's review, and the additional disclosures made as a result of that review, are matters that I take into account in assessing whether the scheme booklet will provide proper disclosure. Having read the various iterations of the draft scheme booklet and considered the interchange between the ASIC, Navitas and the independent experts, I am satisfied, on a provisional basis, that the scheme booklet will provide proper disclosure.
7. Specifically, the scheme booklet in its final form contains a detailed and extensive explanatory statement. It sets out the advantages and disadvantages of the scheme in a way that is comprehensive yet readable. It expressly considers whether the scheme is fair and reasonable from the perspective of the shareholders. It also provides, by way of the IER, an independent expert opinion that sets out detailed reasons for the conclusion reached and the methodology used.
8. As to the due diligence and verification process undertaken by Navitas and BGH BidCo, I have had regard to, and accept, the evidence given by Mr Rumpus (at pars 12 to 21 of his affidavit) and Mr Morfis (at pars 26 to 43 of his affidavit). In summary, there has been verification of the various statements in the scheme booklet. Steps have also been taken to satisfy Navitas and BGH BidCo that the scheme booklet does not omit any material information.
9. Otherwise, as to disclosure, in being satisfied that the scheme booklet contains the prescribed information in accordance with s 412(1)(a)(ii) of the Act and Sch 8 of the Corporations Regulations 2001 (Cth) I was assisted by a checklist provided by Navitas' counsel as an attachment to Navitas' written submissions. Those requirements have been modified in respect of certain items by the ASIC's letter dated 9 May 2019 (attachment 'RRK12' at p 599 of Mr Krasnoff's first affidavit sworn 9 May 2019).

1. In making orders to convene the scheme meetings on Navitas' application I was (and I remain) satisfied in terms of the F T Eastment & Sons Pty Ltd standard.[3] The proposed scheme is a commercial proposition of such a nature and cast in such terms that there is no apparent reason that it should not receive the court's approval if the requisite majorities are achieved at the scheme meetings.
2. There is, as I have already said, nothing to suggest that the scheme is not properly proposed or is unlawful. Accordingly, prima facie there are no negative aspects which might see the court refuse approval. Conversely, I am satisfied that the scheme is one that sensible business people might consider to be of benefit to Navitas' members.
3. In finding, positively, that the proposed arrangement is one that seems fit for consideration by meetings of Navitas' members and is a commercial proposition likely to gain the court's approval if passed by the necessary majorities, I rely on two main factors:

(1) First, the directors' recommendation and the reasons given for the directors' recommendation.

1. The directors are experienced business people who are well placed to make the recommendation that has been provided to members. It is apparent that the directors have been independently advised and have negotiated with the BGH Consortium to achieve a better outcome for members than was available under the first indicative proposal. I have carefully considered the reasons provided by the directors for their recommendation, as given in the scheme booklet and Ms Horton's affidavit, and consider that, for the reasons the directors have given, their recommendation is one that that is reasonably open.
2. In the circumstances I am satisfied that I should give weight to the directors' recommendation.
3. The IER provides detailed reasons for the opinion the independent experts have reached on the merits of the proposed scheme and whether it is in the best interests of the Navitas shareholders. The independent experts' process of reasoning has been exposed for members' consideration. Having read the IER I am satisfied that the opinion expressed is open. Accordingly, this too is of considerable assistance in concluding that Navitas has met the F T Eastment & Sons Pty Ltd standard.
4. Accordingly, to the limited extent that it is necessary to consider apparent fairness and reasonableness at this first stage, I was and am satisfied that the proposed scheme of arrangement is one that is fit for consideration by Navitas' members.

1. In written submissions counsel for Navitas drew a number of matters to my attention. These included the issue of performance risk, the exclusivity provisions in the SID and issues as to particular terms within the scheme.

1. I was and am satisfied that the nature and terms of the proposed scheme are such that the members are adequately protected against the risk that BGH BidCo will not perform its obligations under the proposed scheme.
2. In that respect I have had regard to:
   • the statements made, and verified, as to BGH BidCo's available funding to meet the scheme consideration;
   • the terms of the scheme; and
   • the deed poll as executed.
3. The main matter for consideration is assurance that the members' shares will not be transferred until the members have received the scheme consideration to be provided for their shares.
4. The scheme contemplates that the transfer of the members' shares to BGH BidCo is first 'subject to' the provision of the scheme consideration in accordance with the scheme and the deed poll (cl 4.2(c)). To that end cl 5 identifies the members' respective entitlements. Insofar as the scheme consideration is to be paid in cash, provision is made to ensure payment. The scheme provides for the creation of a trust account of which Navitas is to be the trustee (cl 5.4(a)). The total of the cash consideration is to be paid into the trust account by 5 pm on the day that is the business day before the implementation date (cl 5.4(a)). Navitas is to pay out the cash consideration on the implementation date (cl 5.4(b)). Appropriate arrangements are also made for the issue of the BGH HoldCo shares to the Consortium Shareholders (cl 5.5, cl 5.8).
5. BGH BidCo will not become beneficially entitled to the Navitas shares until provision of the scheme consideration to the Navitas shareholders (cl 8.3(b) - see also cl 8.4 as to ability to appoint proxies).
6. The arrangements under the terms of the scheme as proposed are supported by the deed poll dated 9 May 2019 that has been executed by BGH BidCo and BGH HoldCo (attachment 'HNM-9').
7. By the deed poll BGH BidCo and BGH HoldCo both undertake in favour of each Navitas shareholder: (1) to provide or procure the provision of the scheme consideration to each scheme shareholder in accordance with the terms of the scheme; and (2) to undertake the actions attributable to them (BGH BidCo and BGH HoldCo) under the scheme. See cl 3. There is also an acknowledgement that the deed may be relied on and enforced by any scheme shareholder (cl 1.3(a)) and that Navitas and each of its directors may act as agent and attorney to enforce the deed poll on behalf of the shareholders (cl 1.3(b)).
8. The deed poll will be enforceable by the Navitas members as they are sufficiently identified within the deed poll.[4]

1. The SID contains standard exclusivity terms. These include a 'no shop' provision (cl 10.2), 'no talk' and 'no due-diligence' clauses (cl 10.3, cl 10.4), a 'notification obligation' (cl 10.5) and a 'matching right' (cl 10.7). Provision is also made for a 'break fee' of $15.651 million that is payable by one party to the other in certain circumstances (cl 11).
2. In terms the break fee obligation is reciprocal, ie there are circumstances in which a break fee is payable by BGH BidCo for reimbursement of costs incurred by Navitas (cl 11.3). Sometimes the reciprocal nature of a break fee assists in establishing its commerciality. It might be questioned whether BGH BidCo has available assets to meet the break fee. BGH BidCo's available funding is for the acquisition of the Navitas shares. It appears, however, that under the Co-Investment Agreement the BGH Consortium members other than RMJ and BGC Capital have agreed to pay the break fee to BGH BidCo if the break fee becomes payable.
3. The 'no talk' and 'no due-diligence' exclusivity provisions are subject to an exception to enable the board of Navitas to comply with its statutory and fiduciary duties in the event of a competing proposal that may reasonably be expected to lead to a superior proposal (cl 10.6).
4. In considering the propriety of exclusivity arrangements the authorities suggest that:
   • The exclusivity period should be certain and of reasonable duration.
   • 'No talk' and 'no due-diligence' type exclusivity arrangements should be subject to a directors' duty carve-out, ie the directors should be able to consider an alternative proposal if it may result in a potentially superior transaction that will better serve the members' interests.
   • The arrangements should be adequately disclosed in the explanatory statement.
   • Appropriate affidavit evidence should be adduced to justify the exclusivity arrangements. That is particularly the case with any 'break' or 'reimbursement' fee. There should be affidavit evidence to justify the terms.
5. The critical concern is whether the presence of the exclusivity provisions is likely to be coercive. The concern arises most acutely with break fees. Ordinarily such fees are justified by costs to the bidder, benefits to the target and its members, and the desirability that commercial transactions be proposed. Thus there is nothing improper in stipulating for a reimbursement fee. However, the presence of such a feature will be of concern where it is coercive. A break fee ought not to be of such a magnitude - or become payable in such circumstances that it might influence shareholders' voting.
6. As drafted the exclusivity provisions are in relatively standard terms, ie there is nothing unusual about them that bespeaks an abnormal or uncommercial bargain. The exclusivity period potentially extends to 30 September 2019, a duration of slightly more than six months. That is at the upper end of normal; but there are authorities where, in the particular circumstances then before the court, a longer period was considered not unreasonable.[5] Given Navitas' global operations and the need to address satisfaction of conditions precedent that require action to be taken outside Australia I am satisfied that the exclusivity period is not unreasonable. There is an appropriate directors' duty exception to the 'no talk' and 'no due-diligence' provisions.
7. The scheme booklet discloses that failure to approve the scheme will not trigger an obligation to pay the break fee. One of the answers to Frequently Asked Questions states (responding to '[i]s there a reimbursement or break fee payable?'):

Under the Scheme Implementation Deed, a Break Fee of approximately $15.65 million may become payable either by Navitas to BidCo, or by BidCo to Navitas, if certain events occur. The failure to pass either Scheme Resolution by the Requisite Majorities will not trigger the payment of the Break Fee by Navitas.

The circumstances in which the Break Fee is payable by Navitas or BidCo (as applicable) are summarised in Annexure A.

For more information see Annexure A. (bold emphasis in original; italicised emphasis added)

1. There is otherwise prominent disclosure of the exclusivity arrangements and the break fee as a whole (scheme booklet, pars 1.4(c) - (d), 6.7, 9.1, Annexure A).
2. Ms Horton's affidavit provides sufficient commercial justification for the exclusivity provisions (pars 38 - 52). Ms Horton's evidence, which I accept, is that she believes the exclusivity provisions and the matching rights are reasonable and appropriate (Ms Horton's affidavit, par 41). The provisions followed arm's length commercial negotiations in which both parties were separately advised and represented by external legal and financial advisers. Often the sort of evidence that is found in Ms Horton's affidavit seeking to provide justification for exclusivity arrangements is expressed in terms that is formulaic and repetitive of the commercial justification expressed in the instrument. Here, however, the Navitas board's rejection of the first indicative proposal and subsequent negotiations to ameliorate against the restrictions in the COPA provide additional authenticity to Ms Horton's evidence.
3. In monetary terms alone the $15.651 million break fee is substantial. However, the amount of the break fee represents 0.75% of the implied value of the share scheme consideration (Ms Horton's affidavit, par 38). It is thus within generally accepted commercial parameters. It also compares favourably to the costs of $19.9 million expected to be paid by Navitas in connection with the proposed scheme as disclosed in the scheme booklet - costs to be paid irrespective of whether the scheme becomes effective and is implemented (scheme booklet, pars 7.4(b), 10.10).
4. In approving the convening of the two scheme meetings I was satisfied, necessarily on a provisional basis given the nature of the first court hearing, that the presence of the exclusivity provisions and the break fee were unlikely to be coercive.

1. Senior counsel for Navitas drew my attention to the 'deemed warranty' provision in the proposed scheme (cl 8.2(c)). The presence of the deemed warranty provision is disclosed at pars 1.4(e) and 9.4 of the scheme booklet. Such deemed warranty clauses are not unusual and are acceptable provided that, as here, their presence is adequately disclosed.[6]
2. In addition the scheme provides that, to the extent permitted by law, the Navitas shares will transfer free from encumbrances and restrictions on transfer of any kind (cl 8.3(a)). That sort of clause is also permissible.[7]
3. Navitas sought orders for the electronic dispatch of the scheme booklet. I made such orders in Re Wesfarmers Ltd. For the reasons I gave there such orders are now commonplace.[8] Details were provided as to the terms of the proposed electronic notification (attachments 'RRK-1' and 'RRK-2'). An order for electronic dispatch of the scheme booklet was appropriate and I was satisfied with the terms of the proposed electronic notification.
4. Finally, orders were sought providing for notice of the second hearing and the conduct of the scheme meetings. Those orders were in relatively standard terms. Nothing further needs to be said about them.

1. On the evidence presented, and after hearing from senior counsel for Navitas, I was satisfied that it was appropriate to make orders convening two scheme meetings to consider whether to approve the proposed scheme. The scheme is one that is fit for consideration by Navitas' members (including the Consortium Shareholders) in the sense that sensible business people might consider the scheme will be of benefit to those members. That is particularly the case given the opinion expressed in the IER.
2. Given the matters I have mentioned as to being satisfied that the scheme booklet prima facie provides proper disclosure to Navitas' members, I also considered it appropriate to approve the draft scheme booklet for distribution.
3. Accordingly, I made orders in these terms:
   1. Pursuant to section 411(1) of the Corporations Act 2001 (Cth) (Act), the plaintiff convene two separate meetings of the holders (Shareholders) of fully paid ordinary shares (Shares) in the capital of the plaintiff for the purposes of considering and, if thought fit, agreeing to (with or without modification), a scheme of arrangement proposed to be made between the plaintiff and its Shareholders (Scheme), being the Scheme substantially in the form set out at pages 452 to 470 of Annexure RRK-11 to the affidavit of Rowan Robshaw Krasnoff affirmed 9 May 2019 and filed herein (Krasnoff affidavit), as follows:

(a) one scheme meeting for a class of Shareholders comprising Mr Rodney Malcolm Jones, Hoperidge Enterprises Pty and Remjay Investments Pty Ltd (together RMJ) and AustralianSuper Pty Ltd in its capacity as trustee for AustralianSuper (AustralianSuper) and any entity through which RMJ or AustralianSuper holds their Shares, but only to the extent that such an entity holds Shares on behalf of RMJ or AustralianSuper and not to the extent that any such entity holds Shares on behalf of any other Shareholder (together Consortium Shareholders), to be held at Brookfield Tower 2, Ground Floor, 123 St Georges Terrace, Perth, Western Australia, on Wednesday, 19 June 2019 at 12.00 noon (Perth time) (Consortium Scheme Meeting); and

(b) a separate scheme meeting for a class of Shareholders comprising all Shareholders other than Consortium Shareholders, to be held at Brookfield Tower 2, Ground Floor, 123 St Georges Terrace, Perth, Western Australia, on Wednesday, 19 June 2019 at 11.00 am (Perth time) (General Scheme Meeting),

(together the Consortium Scheme Meeting and the General Scheme Meeting are referred to in these orders as the Scheme Meetings).

1. The explanatory statement in relation to the Scheme, as required by section 412(1)(a) of the Act and set out in the scheme booklet which is at pages 336 to 582 of Annexure RRK-11 to the Krasnoff affidavit) (Scheme Booklet), is approved for distribution to Shareholders, subject to:

(a) correction of any minor, typographical or grammatical errors and final typesetting and formatting;

(b) any minor amendments required or approved by the Australian Securities and Investments Commission (ASIC) for registration under section 412(6) of the Act;

(c) correction or update of any relevant date references or last trading prices;

(d) incorporating in section 8 of the Scheme Booklet the letter from Ernst & Young to the directors of the plaintiff dated 10 May 2019 which is at Annexure RRK-14 to the supplementary affidavit of Rowan Robshaw Krasnoff affirmed 9 May 2019 and filed herein;

(e) adopting as Annexure B of the Scheme Booklet a copy of the executed Deed Poll a version of which is at pages 99 to 106 of Annexure HNM-9 to the affidavit of Haroula Nicolaou Morfis affirmed 9 May 2019 and filed herein;

(f) adopting as Annexure C of the Scheme Booklet the Scheme referred to in paragraph 1 of these Orders; and

(g) adopting as Annexure F of the Scheme Booklet a signed version of the report of Lonergan Edwards & Associates Limited which is at pages 602 to 702 of Annexure RRK-11 to the Krasnoff affidavit, with any necessary changes contemplated by (a), (b) or (c) above.

1. Subject to these orders, pursuant to section 1319 of the Act, the Scheme Meetings are to be:

(a) convened, held and conducted in accordance with the provisions of Part 2G.2 of the Act that apply to members of a company and the provisions of the plaintiff's constitution that are not inconsistent therewith and that apply to meetings of members;

(b) convened using the notices of meetings in the form or substantially to the effect of the notices of meetings contained in Annexure D and Annexure E to the Scheme Booklet which are at pages 471 to 480 of Annexure RRK-11 to the Krasnoff affidavit; and

(c) convened, held and conducted as if rule 2.15 of the Supreme Court (Corporations) (WA) Rules 2004 (WA) does not apply.

1. Tracey Ann Horton AO or, failing her, Antoni Michael Cipa is appointed to act as chairperson of the Scheme Meetings (Chairperson) and is to report the result of the Scheme Meetings to the Court.
2. The Chairperson may adjourn the Scheme Meetings in her or his absolute discretion to such time, date and place as she or he considers appropriate.
3. Two shareholders present in person or by proxy, corporate representative or attorney under power and entitled to vote shall constitute a quorum for each of the Scheme Meetings.
4. Voting on the resolutions to approve the Scheme at the Scheme Meetings is to be conducted by way of a poll.
5. Each Shareholder present and entitled to vote will be entitled to one vote for each Share that the Shareholder is registered as holding at 5.00 pm (Perth time) on 17 June 2019.
6. Subject to registration of the Scheme Booklet with ASIC pursuant to s 412(6) of the Act, the plaintiff is to dispatch on or before 17 May 2019 a document substantially in the form of the Scheme Booklet (approved for distribution above) and the applicable proxy form (utilising the proxy forms, as personalised, contained at pages 531 to 534 and 540 to 541 in Annexure DRD-6 to the affidavit of David Roger Davies sworn 24 April 2019 and filed herein) (or a link to a website for any electronic proxy lodgement) to the Shareholders who appear on the register of members as at 5.00 pm Perth time on the business day before the first day on which dispatch of the Scheme Booklet is initiated, as follows:

(a) to each Shareholder who has nominated an electronic address for the purposes of receiving notices of meeting from the plaintiff, by email to such address, such email to be substantially in the form of the draft emails set out at:

(i) Annexure RRK-1 to the Krasnoff affidavit, for Shareholders other than Consortium Shareholders; and

(ii) Annexure RRK-2 to the Krasnoff affidavit, for Consortium Shareholders.

(b) to each other Shareholder, by pre-paid mail to the address as set out in the register of the plaintiff's members, or any other address the member supplies to the plaintiff for giving notices.

1. Dispatch of the documents referred to in paragraph 9 of these orders in accordance with the delivery methods stated in paragraph 9 of these orders on or before 17 May 2019 is taken to be sufficient notice of the Scheme Meeting.
2. If it comes to the attention of the plaintiff that any email dispatched in accordance with order 9(a) above has returned an undeliverable or undelivered receipt for a Shareholder's nominated email address then, in respect of that Shareholder, the plaintiff is to dispatch, within a reasonable time thereafter, a document substantially in the form of the Scheme Booklet and the applicable proxy form in accordance with order 9(b).
3. The time by which the Shareholders must return their proxy forms or lodge them online in relation to the Scheme Meetings is:

(a) 12.00 noon (Perth time) on 17 June 2019 in relation to the Consortium Shareholders; and

(b) 11.00 am (Perth time) on 17 June 2019 in relation to all Shareholders other than Consortium Shareholders.

1. The matter be relisted at 9 am on 21 June 2019 for such hearing as is appropriate following the Scheme Meetings.
2. If the matter is to be relisted, the plaintiff is to give notice of the hearing of the application pursuant to section 411(4)(b) of the Act for orders approving the Scheme by publishing an advertisement in the public notices columns of "The Australian" and "The West Australian" substantially in the form of Annexure "A" to these orders, to be published by 14 June 2019, and the plaintiff is otherwise exempt from compliance with rule 3.4 of the Supreme Court (Corporations) (WA) Rules 2004 (WA).
3. These orders be entered forthwith.
4. A copy of these orders be lodged with ASIC as soon as practicable after issue.

Annexure A

Notice of hearing to approve scheme of arrangement

TO all the members of Navitas Limited (ACN 109 613 309).

TAKE NOTICE that at 9.00 am (Perth time) on 21 June 2019 at the Supreme Court of Western Australia, 28 Barrack Street, Perth in the State of Western Australia, the Supreme Court of Western Australia will hear an application by Navitas Limited seeking the approval of an arrangement between the abovenamed company and its members if agreed to by resolutions to be considered and, if thought fit, passed (with or without modifications) by two meetings of the members of the company to be held on 19 June 2019.

If you wish to oppose the approval of the arrangement, you must file and serve on the plaintiff a notice of appearance, in the prescribed form, together with any affidavit on which you wish to rely at the hearing. The notice of appearance and affidavit must be served on the plaintiff at its address for service at least one day before the date fixed for the hearing of the application.

The address for service of the plaintiff is Ashurst Australia, Level 10, 123 St Georges Terrace, Perth in the State of Western Australia (Reference: CXP PCO 09 3004 5058).

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

[1] Re Wesfarmers Ltd; ex parte Wesfarmers Ltd [2018] WASC 308 [46] [78] (Re Wesfarmers Ltd).

[2] Re Capilano Honey Ltd [2018] FCA 1568.

[3] Referring to F T Eastment & Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69.

[5] See Re Kangaroo Resources Ltd; Ex parte Kangaroo Resources Ltd [2018] WASC 327 [63] - [65].

[6] Re Tawana Resources NL [2018] FCA 1456 [28] - [29] (referring to Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400 [60]).

[7] Re Investa Properties Ltd [2007] FCA 1104; (2007) 25 ACLC 1186 [22] - [30].

[8] Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd [145] - [152].