Acquiring Shares in Public Ltd company

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..... Acquiring Shares in Public Ltd company
Query (Issue) Started By: - Ysil Karunai Dated:- 17-2-2011 Last Reply Date:- 4-10-2012 FEMA
Got 1 Reply
FEMA
Dear Sir, Please consider the following Situation: A and B is a Director & Shareholders in a XYZ Private Ltd Company incorporated in India, holding the shares as 60% by A & 40% by B. A is a Foreign National, while B is NRI. Mr. A & Mr. B .....

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..... are Proposed to acquire all the shares in a ABC Closely held Public limited company incorporated in India, since the ABC company owns Agricultural Land and it is proposed to used for the purpose of XYZ company Business. Mr. A & Mr. B bring the money and invest in XYZ(p) Ltd and XYZ(P) Ltd acquire all the shares in a ABC PLC. Now, the XYZ(P) Ltd is 100% Holding company of ABC PLC. Query: 1. The Sh .....

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..... ares have been alloted in the name of XYZ(P) Ltd. Whether it is correct? or it should be alloted in the name of Mr. A & Mr. B only, since they paid money for acquiring the shares through the XYZ(P) Ltd. 2. Whether XYZ(P) Ltd is Deemed Public Ltd Company? If yes, Whether there is any voilation of Companies Act,1956, So as to comply with minimum number of Directors and Shareholders/members? What oth .....

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..... er provisions of the companies Act has to be complied with? 3. The money bring by Directors are in Foreign Currency Converted into INR routed through XYZ(P) Ltd. What are the Procedural Compliance in the light of FEMA? 4. Whether Section 187C will hit for the above mentioned argument? 5. Whether XYZ(P) Ltd company has to Complied with section 212 and AS-21 for Presenting their Financial Statement? .....

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..... Reply By CA. Surender Gupta: The Reply: It is a technical query which requires details scrutiny of the provisions of Company Law, FEMA and FDI guidelines. Since the query is very old, you may have address the issue in certain way, would you like to put some light for the benefit of others on this issue.
Discussion Forum - Knowledge Sharing .....

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