1995 (11) TMI 322 - HC - Companies Law

Summary

Issues:
1. Approval of Scheme of Amalgamation between GAL Offshore Services Ltd. and Great Eastern Shipping Company Ltd.
2. Share exchange ratio modification from 7:4 to 1:1.
3. Official Liquidator and Regional Director's no objection to the scheme.
4. Court's decision to sanction the scheme.

Analysis:
1. The judgment involves two petitions filed by the Transferor-Company and Transferee-Company seeking the Court's approval for the Scheme of Amalgamation between GAL Offshore Services Ltd. and Great Eastern Shipping Company Ltd. The proposed merger aims to increase GESCO's equity capital by Rs. 8.5 crores and transfer GAL's assets worth around Rs. 82 crores to GESCO.

2. Initially, the draft scheme proposed a share exchange ratio of 7:4, which was later revised to 5:2. However, following suggestions from shareholders, the share exchange ratio was further amended to 1:1, indicating a more shareholder-friendly approach. The Court granted leave to amend the scheme, substituting the share exchange ratio as 1:1, which was considered and sanctioned by the Court.

3. The Official Liquidator and the Regional Director of the Department of Company Affairs raised no objections to the scheme as amended. The Official Liquidator's report confirmed that the Transferor-Company did not act prejudicially towards shareholders or others. Similarly, the Regional Director expressed no objections to the sanctioned scheme.

4. Considering the absence of opposition to the scheme and the no-objection stance of concerned parties, the Court passed an order sanctioning both petitions. The Court made the petitions absolute, directing the petitioners to pay specified costs and file certified copies of the order with the Registrar of Companies. The judgment reflects the Court's approval of the Scheme of Amalgamation between GAL Offshore Services Ltd. and Great Eastern Shipping Company Ltd., with the revised 1:1 share exchange ratio.

This detailed analysis of the judgment highlights the key issues addressed by the Court, including the approval process, share exchange ratio modifications, official endorsements, and the final decision to sanction the scheme of amalgamation.