Talison Lithium Limited, in the matter of Talison Lithium Limited (No 2) [2012] FCA 1426

REASONS FOR JUDGMENT 1 On 25 October 2012, the Court made orders for the convening of meetings to consider two schemes of arrangement proposed by the plaintiff, Talison Lithium Limited (Talison) (Talison Lithium Limited, in the matter of Talison Lithium Limited [2012] FCA 1422). The schemes of arrangement contemplated, in effect, a merger of Talison and Rockwood Holdings Inc (Rockwood), an American company, whose shares are listed on the New York Stock Exchange. The first scheme of arrangement proposed was between Talison and its members and the second scheme of arrangement proposed was between Talison and its option holders. The orders called for the holding of meetings on 29 November 2012. 2 However, these meetings have been adjourned by reason of developments which occurred after the making of the orders. I refer below to those developments. 3 On 12 November 2012, Chengdu Tianqi Industry (Group) Co Limited (Tianqi) announced that it intended to submit a proposal under which a wholly owned subsidiary would, by way of a scheme of arrangement, acquire all the shares in Talison which it did not already own. Thereafter negotiations ensued between representatives of Talison and Tianqi. The upshot of these negotiations, was that the board of Talison concluded that the Tianqi proposal was a superior proposal to that made by Rockwood. The board of Talison resolved to withdraw its recommendation to its members and option holders to approve the Rockwood schemes of arrangement, which were the subject of the orders made by the Court on 25 October 2012. 4 The board of Talison then entered into a scheme implementation agreement between Talison and Windfield Holdings Pty Ltd (a wholly owned subsidiary of Tianqi), to implement the Tianqi scheme of arrangement. 5 The events described in the preceding paragraphs, meant that Rockwood was entitled under cl 10.2(a)(ii) and cl 10.2(a)(iii) of the scheme implementation agreement of 23 August 2012 between Talison and Rockwood, to be paid the prescribed break fee and also to terminate the scheme implementation agreement pursuant to cl 15.2(b)(v). 6 By an agreement dated 12 December 2012 between Talison, Rockwood and Rockwood Lithium Australia Pty Ltd, the wholly owned subsidiary which was to acquire all of the shares and options under the Rockwood schemes of arrangement, the parties agreed to terminate the Rockwood scheme implementation agreement. It is a term of that termination agreement that Talison would promptly after the date of the agreement seek appropriate orders from the Court for the dissolution of the schemes of arrangement the subject of the Court orders. 7 Talison has applied to the Court for the making of orders vacating orders 1, 2, 4, 8, 9 and 10 which were made on the 25 October 2012 and for the proceeding to be dismissed. 8 In light of the facts and circumstances which I have outlined above, I will make the orders sought by Talison. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis.