Tilt Renewables Limited
Transaction Type: Scheme of arrangement
Date of meeting: 10/06/2020
On 5 May 2020, Tilt Renewables Limited (Tilt) announced that it intended to undertake a pro rata capital return of A$260 million to its shareholders by way of a Court-approved scheme of arrangement (the Scheme) under Part 15 of the Companies Act 1993 (the Act).
Under the terms of the Scheme, Tilt proposed to cancel one share out of every five shares and pay each shareholder NZ$2.91 for each share cancelled. Fractions of a share were to be rounded up or down to the nearest whole number. As a result, the relative percentage of voting rights held by shareholders would remain unchanged when rounded to the eighth decimal place.
On 21 April 2020, the Panel issued a letter to Tilt stating that the Panel considered the Scheme was not a transaction to which section 236A of the Act applies. Accordingly, the Panel's view was that it was not necessary to issue a no-objection statement. However, the Panel also noted that if the Court determined that section 236A of the Act did apply, the Panel considered the Scheme to be an immaterial change of voting control scheme for the purposes of its Guidance Note on Schemes of Arrangement.
Shareholders voted in favour of the Scheme on 10 June 2020 and, of the shareholders that voted, 99.94% voted in favour of the Scheme. Final orders were then granted by the Court on 19 June 2020.
In Re Tilt Renewables Limited [2020] NZHC 1398 at [15], Muir J expressed his view that, on the facts specific to the Scheme, section 236A of the Act did not apply despite the fact that rounding would be necessary.
The relevant shares were cancelled and the Scheme was implemented on 6 July 2020.
