COMPROMISES, ARRANGEMENTS AND AMALGAMATIONS - Proposed Amendments in the Companies Act, 2013

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....OMPROMISES, ARRANGEMENTS AND AMALGAMATIONS - Proposed Amendments in the Companies Act, 2013 <br>News and Press Release<br>Dated:- 2-2-2016<br><BR>Purchase of Minority Shareholding 15.1 Section 236 o....

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....f the Act deals with the purchase of minority shareholding. This provision refers to the acquisition of shares of a company and contemplates a situation where an acquirer, or a person acting in concer....

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....t with such an acquirer, becomes a registered holder of ninety percent or more of the issued equity share capital of a company. This provision prescribes that such an acquirer shall notify the company....

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.... of his intention of buying the remaining equity shares. While Sections 236 (4), 236 (5) and 236 (6) make a reference to a "transferor company", the term 'transferor company' has not been defined in t....

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....he section itself. The Committee felt that the use of the term 'transferor company' in the said Section 236 without providing for a context may ostensibly include even transfer of assets by a company,....

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.... thereby including amalgamations and mergers within the ambit of this provision, which did not appear to be the intention. Accordingly, the Committee recommended that the references to the phrase 'tra....

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....nsferor company' in Section 236, may be modified to a 'company whose shares are being transferred' or alternatively, an explanation be provided in the provision clarifying that Section 236 only applie....

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....s to the acquisition of shares.<BR> News - Press release - PIB....