Amalgamation scheme and consequential share capital reduction sanctioned after approvals, notice compliance and no creditor prejudice found.

A scheme of arrangement in the nature of amalgamation, along with consequential reduction of the transferee company's share capital, was sanctioned after the requisite equity shareholder and creditor approvals were obtained or dispensed with through written consents. No objections were received after public notice, the Official Liquidator reported no prejudicial conduct in the transferor company's affairs, and the Regional Director's observations were met and found not to survive. The Court recorded that the scheme was in the interests of the shareholders and creditors of both companies, was not contrary to public interest, and that the share capital reduction was consequential to cancellation of shares held by the transferor company without prejudice to creditors.

---

---

Issues: Whether the proposed Scheme of Arrangement in the nature of amalgamation, together with the consequential reduction of share capital of the transferee company, deserved sanction.

Analysis: The requisite approvals of the equity shareholders and creditors had been obtained or dispensed with on the basis of written consents, no objections were received after publication of notice, and the Official Liquidator reported that the affairs of the transferor company had not been conducted prejudicially. The Regional Director's observations were met by the petitioners and were found not to survive. The Court found that the scheme was in the interest of the shareholders and creditors of both companies and was not contrary to public interest. The reduction of share capital was held to be consequential to the cancellation of shares held by the transferor company and did not prejudice creditors.

Conclusion: The scheme of amalgamation and the consequential reduction of share capital were sanctioned, and the petitions were allowed and disposed of.

---