Demerger of Fixed Assets (Land) which is not related to existing product

[Ashok Chopra]

Respected Forum,

Me is a Private Limited Company having Land in the name of the company at various places which is not related to the product being manufactured by us.  Directors of the company are four brothers.  Can we incorporate new company and DEMERGE the said FIXED ASSETS (LAND) from the existing company by reducing Capital  proportionatly.

Please advice me Is it a correct procedure or there any other correct and legal  procedure as we are in the process of introducing PUBLIC ISSUE and we want that Land which is in the name of Company and not related with the product being manufactured  be DEMERGE from existing company.

regards

 

AI Summary

Company Owned by Brothers Plans Demerger to Exclude Land Assets Before Public Issue; Consults on Compliance with CCI Rules. A private limited company, owned by four brothers, seeks advice on demerging land assets unrelated to their manufacturing business. They are considering forming a new company to transfer these assets and proportionally reduce capital. The company is preparing for a public issue and wants to ensure the land is not part of the existing company. The response advises that any demerger or spinoff must be reported to the Competition Commission of India and suggests consulting with a professional for guidance.