HMC Capital Limited (HMC) Earnings Call Transcript & Summary

Good morning. Welcome to the Extraordinary General Meeting of Securityholders of Home Consortium Limited. My name is Chris Saxon, I'm the Chair of Home Consortium, and I'll chair today's Extraordinary General Meeting. There's a quorum of securityholders present so declare the meeting open. Again, the meeting is in virtual format only. Securityholders can be present virtually via the live webcast. You'll be able to vote electronically through the online platform, supplied by Link Market Services. To log in, you need your holder ID and post code. The online platform provides an opportunity for all our securityholders to participate. As you're aware from the previous addresses filed with the ASX and tabled at the AGM, the business to be considered at the meeting today is to consider 2 resolutions of Home Consortium shareholders in relation to the destapling of Home Consortium stapled shares and the share consolidation of Home Consortium shares. The resolutions are necessary to implement our restructure proposal. In order for that proposal to be implemented, all the resolutions required to be approved by the requisite majority of Home Consortium shareholders are interconditional. The approval thresholds for the resolutions at this meeting are as follows: The resolution approving the destapling of Home Consortium shares has to be passed by at least 75% of the votes cast by Home Consortium shareholders entitled to vote at the meeting; and the resolution approving the share consolidation of Home Consortium shares immediately following the acquisition of all HCDL shares, passes only if it is voted on by at least 50% of votes cast in favor by Home Consortium shareholders entitled to vote. If you don't vote on the resolutions or vote against the resolutions, but the resolutions of the meeting and the subsequent meetings are approved by the requisite majorities. The restructure proposal will be implemented if other conditions are met, and you will be bound to participate in a restructure proposal, if you are on the register as a Home Consortium shareholder on the proposal record date that is Friday, 17th December 2021. I'll now give some background on the matter of the subject of today's meeting. And after that, address any questions, and formally put the resolutions to a vote by poll. In relation to the destapling resolution, as you know, the shares in HCL and HCDL are currently stapled together so that they cannot be dealt with individually. In order to implement the restructure proposal, it's necessary to destaple the stapled shares prior to the transfer of HCDL shares to HCL under the scheme. That process is covered by the HCL constitution, the HCDL constitution and a document called the stapling deed. Under those documents, Home Consortium must procure that the HCL shares and the HCDL shares are destapled if 3 things occur. First, a special resolution of the members of HCL and HCDL is passed to destaple the stapled shares. And those are the resolutions being considered at the EGM and the following EGM of HCDL. Second, the ASX has to indicate in writing that it grants permission for the destapling. The ASX gave our company written permission to do that on the 3rd of November 2021. And thirdly, Home Consortium must determine that the stapling of the Home Consortium stapled shares -- I beg your pardon, the destapling, is not contrary to the interest of Home Consortium shareholders as a whole. I confirm that for the reasons outlined in the shareholder booklet, our Board of Directors has determined that the proposal, including the destapling is in the best interest of Home Consortium shareholders as a whole. Accordingly, subject to approval of the destapling by the Home Consortium shareholders in their capacity as both HCL shareholders and HCDL shareholders and the scheme becoming effective, the destapling will occur on the proposal implementation date. That's currently expected to be 24 December 2021. Note that the constitutions of both companies will not need to be amended to implement the destapling because the constitutions provide that those stapling provisions cease to apply if the scheme is adopted. The background in relation to the share consolidation is that immediately following implementation of the scheme, Home Consortium intends to consolidate the number of Home Consortium shares held by shareholders so that eligible shareholders will hold one Home Consortium share for each Home Consortium stapled share that they held at the proposal record date, subject to rounding. For this to occur, an ordinary resolution must be passed by at least 50% of votes cast by Home Consortium shareholders at this meeting. If the proposal proceeds, all Home Consortium shareholders on the register on the proposal record date will have their HCL shares consolidated on approximately a 2.65:1 basis. Fractional entitlements of HCL shares will be rounded to the nearest whole number of shares. As I mentioned before, the share consolidation is expected to be implemented on the 24th of December 2021, assuming all resolutions are passed. With that background, I'll now turn to voting on the 2 resolutions. The first of those is the destapling resolution. Can I ask Andrew to read out any questions that have been put by securityholders in relation to that resolution.

Sure, Chris. I confirm there have been no questions put by securityholders in relation to this resolution, either via the online platform or via audio.

Thanks, Andrew. I'll put the resolution to the meeting for a vote by poll. The resolution is to consider, and if thought fit, to pass the following as a special resolution of Home Consortium Limited. That, subject to and conditional upon the scheme becoming effective, the destapling of the HCL shares and HCDL shares in accordance with the terms of the stapling deed, the HCL constitution and the HCDL constitution be approved. We have received proxies in relation to the resolution. Andrew, can you summarize as for, open and against as received and disclosed to the market today.

Sure, Chris. Proxy voting results of the destapling resolution are as follows: for, 99.97%; open, 0.03%; and against, 0.00%.

Thanks, Andrew. The Directors recommend that you vote in favor of the resolution. And I, as Chair, intend to exercise all proxies available to me in favor of the resolutions. Can I ask you to cast your vote. You'll have until the end of the meeting to complete voting, but I'll pause briefly to allow you to vote on the resolution. [Voting]

Okay. Thank you. Turning to the vote on the share consolidation resolution. Again, can I ask Andrew to read out any questions put by securityholders on this resolution?

Sure, Chris. I confirm that there have been no questions put by securityholders in relation to this resolution either via the online platform or via the audio line.

Thanks, Andrew. So I'll put the resolution of the meeting for a vote by poll. That resolution is to consider, and if thought fit, to pass the following as an ordinary resolution of Home Consortium Limited. That, subject to and conditional upon the scheme becoming effective and being implemented, for the purposes of Section 254H of the Corporations Act and for all other purposes, approval is given for the consolidation of HCL shares on the basis that each number of HCL shares determined by dividing the number of HCL shares on issue immediately after the implementation of the scheme by the number of HCL shares on issue as at the proposal record date will be consolidated into one Home Consortium share with any resulting fractional entitlement of a Home Consortium shareholder to an HCL share rounded to the nearest whole number. In relation to the resolution, we have received proxies. Andrew will summarize the votes for, open and against that we have received and have been disclosed to the market today.

Thanks, Chris. Proxy voting results for the share consolidation resolution are as follows: for, 99.98%; open, 0.02%; and against, 0.00%. Thanks, Chris.

Thanks, Andrew. The Directors recommend in favor of the resolution. And I will vote all proxies available to me in favor. I'll ask you to cast your vote. I'll pause for you to do that, and then we'll conclude the meeting. [Voting]

Okay. Thank you. I do now open the floor for any final questions at this morning's extraordinary general meeting. Could I ask you to put any questions or comments to the meeting now. Andrew, is there any?

Chris, I confirm that there are no questions on any item of business at this morning's meeting either via the online platform or via the audio line.

Thanks, Andrew. The results of this morning's meeting will be announced to the market on the ASX as soon as they're available. As I mentioned, we have one more meeting to hold. That is the Extraordinary General Meeting of HCDL shareholders to approve the destapling of shares. We'll hold that meeting in 5 minutes. I encourage you to attend. And again, refer to the guide filed with the ASX in relation to virtual meetings. I look forward to welcoming you into that meeting shortly. Thanks.