The High Court has cleared Permanent TSB Group Holdings plc to convene a shareholder meeting on its proposed €1.62 billion acquisition by Austrian bank BAWAG PSK.
Mr Justice Mark Sanfey also admitted the proceedings to the Commercial List. The proposed scheme would give shareholders €2.97 in cash for each scheme share.
A dispute remains over whether the Minister for Finance, who holds 57.5% of the company, should vote in the same shareholder class as other investors.
Shareholder Piotr Skoczylas and other applicants argued that the Minister should form a separate class. They said leaving all shareholders in one class could discourage smaller shareholders from voting because the Minister's holding could make the required majority appear inevitable.
Permanent TSB withdrew its request for the court to direct that shareholders form a single class. Instead, it proposed holding the meeting on that basis and allowing objections to class composition to be argued later, if the company applies for court sanction of the scheme.
Mr Justice Sanfey said Irish courts normally examine whether shareholder classes have been properly constituted at the sanction stage. While the High Court has power to address the issue when convening a meeting, he saw no reason to depart from the usual procedure.
He found no evidential basis for the claim that smaller shareholders would be less likely to vote. He also concluded that Mr Skoczylas and the other applicants would not be prejudiced because they can make their class-composition arguments at the sanction hearing.
The judge said resolving the issue earlier could delay the transaction through further affidavits, submissions, hearings and a possible appeal. He considered it preferable for all objections to the scheme to be dealt with together.
The court therefore ordered the scheme meeting to be convened under section 450(3) of the Companies Act 2014. The judge said he would hear counsel on the detailed notification and meeting directions, and separately on what order should be made in the proceedings brought by Mr Skoczylas and the other applicants.