Sir Michael Birt, Kt., Bailiff, and Jurats Clapham and Milner
IN THE MATTER OF THE REPRESENTATION OF KENTZ CORPORATION LIMITED
AND IN THE MATTER OF ARTICLE 125 OF THE COMPANIES (JERSEY) LAW 1991
Advocate N. M. Sanders for the Representor.
Advocate M. H. Temple for SNC-Lavalin (GB) and SNC-Lavalin Group Inc.
1. This is an application by Kentz Corporation Limited ("the Company") for sanction of a scheme of arrangement with its shareholders under Article 125 of the Companies (Jersey) Law 1991 ("the Law").
2. The nature of the application is straightforward and can be shortly stated. The Company is incorporated in Jersey. It carries on business as a global engineering specialist solutions provider. It has 14,500 employees operating in thirty-six different countries.
3. The authorised share capital is £1,863,333 divided into 186,333,300 Ordinary shares of £0.01 each. At close of business on 9th July, 2014, there were 122,046,580 Ordinary shares in issue. The shares are listed on the London Stock Exchange.
4. The board of the Company has agreed terms for the acquisition of all the shares in the Company by a newly formed UK subsidiary of SNC-Lavalin, which is one of the world's leading engineering and construction groups with headquarters in Montreal, Canada and whose shares are listed on the Toronto Stock Exchange. The agreed purchase price is 935 pence per Ordinary share. It is intended that the acquisition proceed by way of a scheme of arrangement under Article 125.
5. The test to be applied by the Court on such matters is well established. It is conveniently summarised in Re Cazenove Capital Holdings  JRC 168 and is three fold. The Court must consider:-
(i) whether the provisions of the Law have been observed;
(ii) whether the class of shareholders to be affected by the proposed scheme was fairly represented by those who attended the meeting and whether the statutory majority are acting bona fide and not coercing the minority in order to promote interests adverse to those of the class whom they purport to represent; and
(iii) whether the arrangement is such that an intelligent and honest man, a member of the class concerned and acting in respect of his interest might reasonably approve.
6. As to (i), the Court is satisfied from the affidavit evidence produced to it that the meeting convened by the Court was duly held, the documents were duly sent to shareholders and the scheme was approved by the statutory majority.
7. As to (ii), the meeting was attended personally or by proxy by 253 shareholders who between them held 62.8% of the issued share capital of the Company. The shareholders were therefore well represented. The resolution was passed by a majority of 99.39% of the votes cast at the meeting. There is only one class of share and the proposals have been set out fully and fairly in the documentation sent to shareholders with the convening notice. The Court is accordingly satisfied as to the second limb of the test.
8. As to (iii), the offer was 33% above the average share price on the stock exchange at the relevant time. Acceptance was unanimously recommended by the board of directors who had in turn been advised by Investec Bank Plc. In addition, as stated above, an overwhelming majority of shareholders at the meeting resolved to accept the offer.
9. In the circumstances the Court is satisfied that all three limbs of the test are satisfied and the Court sanctions the scheme in accordance with the draft Act produced to us.
Companies (Jersey) Law 1991.