Schemes of Arrangement

This subject has the following teaching availabilities in 2011:

It is recommended that students have studied company law or a comparable subject, or have relevant corporate experience.

Note: This subject does not address schemes of arrangement in the insolvency context.

Principal topics will include:

• What a scheme of arrangement is and the role schemes play in the field of takeovers, company mergers and other corporate reconstructions
• The statutory framework applicable to schemes of arrangement
• Statutory and other requirements governing schemes of arrangement and their approval
• The role of the court at each of the first court hearing (the ‘meeting hearing’) and the second court hearing (the ‘approval hearing’)
• The role of ASIC
• Practical considerations and guidance – including potential pitfalls – in connection with the approval process
• Issues that are to be considered and addressed in connection with the obtaining of shareholder and court approval. Topics to be drawn from matters such as:
  • Notice requirements
  • The scheme booklet: Content and approval
  • Meetings of shareholders: How, what, when and why
  • Classification of schemes and classes of members
  • Independent experts
  • Break fees and exclusivity provisions
  • Warranties and performance risk
  • Overseas interests
  • Impact on third parties: Chapter 6 avoidance, ASIC position and Section 411(17) of the Corporations Act 2001 (Cth)
  • Abrogation of fiduciary duties
  • Forum consideration and differing judicial approaches
  • Opposition at court hearings and the court’s ‘approval’ discretion
• Reform issues and consequences and the role and impact of the Corporations and Markets Advisory Committee on the future regulation of schemes.

A student who has successfully completed this subject should:

• Understand the role and purpose of schemes of arrangement in the field of takeovers, company mergers and other corporate reconstructions
• Understand the role of the court at each stage of the court approval process
• Understand what is required in order to obtain shareholder and court approval of a proposed scheme of arrangement, including knowledge of the primary matters to be considered and addressed at each stage of the approval process
• Understand the role played by the Australian Securities and Investments Commission (ASIC) in connection with proposed schemes of arrangement
• Understand the practical considerations and steps to seeking and obtaining court approval
• Appreciate and understand the issues that have influenced debate regarding reform and be in a position to form their own views about the issues and related matters.

Visit the Melbourne Law Masters website for more information about this subject.

This subject is not available as a breadth subject.