The Supreme Court of NSW has approved a proposed deal by paper merchant Spicers that’s designed to simplify the company’s capital structure and break a long-running deadlock with its hybrid shareholders.
In a statement to the ASX, Spicers (formerly PaperlinX) said the Supreme Court yesterday provided 'the first judicial advice required for the Trust Scheme agreement to proceed.'
The advice gave approval for the Responsible Entity to distribute to members a Unitholder Booklet and prospectus issued by Spicers in relation to the Trust Scheme and convene two general meetings at which members of the SPS Trust will consider and vote on the Trust Scheme.
The meetings of both groups of shareholders will be held on Wednesday, June 14.
“The Spicers board strongly believes in the commercial rationale and benefits of the proposal,” said Spicers chairman Robert Kaye. “Simplifying the capital structure is a key pillar of the Spicers Board’s plans to unlock value for both sets of security holders and to put Spicers on a more sound and sustainable footing for the future."
Kaye urged all shareholders to back the deal.
The company’s capital structure will only be unified and simplified if both sets of security holders vote in favour of the Proposal with the requisite majorities. If the Proposal is approved and implemented, Eligible SPS Unitholders will receive 545 Spicers Shares in exchange for each SPS Unit held. Your directors unanimously recommend that Shareholders vote in favour of the Resolution.
The Trust Company (RE Serviced) Limited, the Responsible Entity for the PaperlinX SPS Trust, also advised its unitholders to back the deal, saying it is in their best interest to vote in favour of the resolutions absent a superior proposal.
The agreement would see the hybrid shareholders take a 68.3 percent stake in the company, and chairman Kaye and non-executive director Michael Barker would step down from the board of directors.
If the shareholder and trust scheme meetings both vote to give the go-ahead, the agreement is scheduled to be implemented on June 27 and normal share trading would resume on June 28. The meetings will be held on June 14 at Computershare Investor Services, Level 4, 60 Carrington Street, Sydney 2000.
PaperlinX began trading under the Spicers name following the collapse of its European operations in 2015.