Amalgamation
This query is : Resolved
29 September 2011
Is the procedure of a subsidiary company's merger with its holding company different from normal amalgamation procedure u/s 391-394.If yes, kindly tell me tha same. What are the main differences to be taken care of? How to find out Share exchange ration if holding co. having 71% of share capital of its subsidiary?
29 September 2011
Dear Gauri
Please take note that the procedure for Amalgamation betweetn holding company and subsidiary company is not different as prescribed in section 391-394 of the Companies Act 1956.
second there will be a clause in the scheme that the cross shareholding will be cancelled means shares held by holding company in the subsidiary company will be cancelled and shares willbe issued only to other sharehiolders.
share exchange ratio will be arrived as usaual with NAV and profit earning capicity of the company.
Please take note that the procedure for Amalgamation betweetn holding company and subsidiary company is not different as prescribed in section 391-394 of the Companies Act 1956.
second there will be a clause in the scheme that the cross shareholding will be cancelled means shares held by holding company in the subsidiary company will be cancelled and shares willbe issued only to other sharehiolders.
share exchange ratio will be arrived as usaual with NAV and profit earning capicity of the company.
30 September 2011
Thank u sir
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