NZ Oil & Gas (NZO)

[fish]

You can only invoke minority shareholder rights if the major shareholder gets over 90% of the shares and are at the compulsory acquisition stage. If they decide to move the company to the ASX or wherever, minority shareholders are still just minority shareholders and have the same rights as now.

But as NZO is a NZ company registered with the NZ companies office, they cannot actually go anywhere and must have a NZ based director and NZ based address.

Thanks blackcap-many years since I was involved in a successful action.
So are you saying if they want to move overseas they have to acquire 90% of shares ?
I am away from home but will check what we did with SEA/TTP

[blackcap]

No worries. I guess the question that I need clarification of is what do you mean by moving overseas?

If they remain a NZ company they remain a NZ company.

I think section 110 and 111 apply to section 106. So yes if they did try to "leave" NZ then minority buyout provisions do apply. BUt if they remain a NZ company but just move offshore and conduct business there (which they pretty much do so currently anyway) then these provisions will not apply,

Section 110
110 Shareholder may require company to purchase shares
Where—
(a)
a shareholder is entitled to vote on the exercise of 1 or more of the powers set out in—
(i)
section 106(1)(a), and the proposed alteration imposes or removes a restriction on the activities of the company; or
(ii)
section 106(1)(b) or (c); and
(b)
the shareholders resolved, pursuant to section 106, to exercise the power; and
(c)
the shareholder cast all the votes attached to shares registered in the shareholder’s name and having the same beneficial owner against the exercise of the power; or
(d)
where the resolution to exercise the power was passed under section 122, the shareholder did not sign the resolution,—


Section 106
106 Powers exercised by special resolution
(1)
Notwithstanding the constitution of a company, when shareholders exercise a power to—
(a)
adopt a constitution or, if it has one, alter or revoke the company’s constitution:
(b)
approve a major transaction:
(c)
approve an amalgamation of the company under section 221:
(d)
put the company into liquidation,—
the power must be exercised by special resolution.

(2)
A special resolution pursuant to paragraph (a) or paragraph (b) or paragraph (c) of subsection (1) can be rescinded only by a special resolution.
(3)
A special resolution pursuant to paragraph (d) of subsection (1) cannot be rescinded in any circumstances.

[fish]

Thanks again
So if they need approval for a major transaction or to alter the constitution now when they only hold 70% shares they need a special resolution and those voting against can invoke minority shareholder rights ?

[Wiremu]

Section 350 of the Companies Act provides for a company to change its registration to another country. Nothing complicated.

Section 352 states that to do so shareholders must approve the change by special resolution. The majority shareholder has full voting rights and as everyone's shares are affected the same there are no shareholder classes such as was the case in the scheme of arrangement.

However this is not a "major transaction" as defined in the Companies Act and shareholders have no minority shareholder rights.

Major Transaction, in relation to a company, means:
(a) the acquisition of, or an agreement to acquire, whether contingent or not, assets the value of which is more than half the value of the company’s assets before the acquisition; or
(b) the disposition of, or an agreement to dispose of, whether contingent or not, assets of the company the value of which is more than half the value of the company’s assets before the disposition; or
(c) a transaction that has or is likely to have the effect of the company acquiring rights or interests or incurring obligations or liabilities, including contingent liabilities, the value of which is more than half the value of the company’s assets before the transaction.

[fish]

Thanks wiremu
This got me thinking as it seems unfair that a company could move to say the Bahamas and prejudice minority shareholders .
I guess the safeguard is the special resolution but even that is negated if the company holds 75% of shares .
I cannot clearly recollect how minority shareholder rights were exercised with TTP/SEA

[ValueNZ]

Yes a lot of us have been burnt .
If they should move overseas I suspect some will invoke minority shareholder rights and with arbitration obtain a fair and reasonable value for their shareholding.

What is deemed "fair and reasonable" in these situations? Current market value? NTA? or somewhere in-between

[fish]

What is deemed "fair and reasonable" in these situations? Current market value? NTA? or somewhere in-between

It is unlikely with NZo .I did find a nz article on prejudice as grounds but do not believe the company choosing the independent directors would meet the threshold for grounds
With ttp/sea it went to arbitration and ended up being in-between

[blackcap]

What is deemed "fair and reasonable" in these situations? Current market value? NTA? or somewhere in-between

I think you would get close to NTA. I was involved with SEA and TTP and the Kerr one recently. Going to get close to NTA normally. I think from memory and it was a long time ago SEA got about 92 cents and that was a good outcome. Not sure with TTP and with the George Kerr one I think substantially more than the SP and close to NTA.

Minority protections in NZ companies Act are pretty robust but unfortunately not many shareholders are aware of them. Tis all about education.

[Sideshow Bob]

https://www.rnz.co.nz/news/business/...y+2+March+2023

The country's biggest oil and gas producer is looking to sell its New Zealand assets.
Austrian-based OMV is looking for buyers for its exploration and production operations in the Asia-Pacific region, including all of its New Zealand operations.

[Wiremu]

https://www.rnz.co.nz/news/business/...y+2+March+2023

[FONT="]The country's biggest oil and gas producer is looking to sell its New Zealand assets.[/FONT]
Austrian-based OMV is looking for buyers for its exploration and production operations in the Asia-Pacific region, including all of its New Zealand operations.

It will be interesting to see who ends up with the OMV assets. It is doubtful that NZOG and/or Cue have enough uncommitted cash to do so, that being the case do we see OGOG go it on their own?