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CS Professional · Corporate Restructuring, Valuation and Insolvency · Documentation - Merger and Amalgamation

Kaveri Auto Ltd and Narmada Components Ltd propose a merger by absorption. The Tribunal has ordered meetings. Under section 232, which of the following must the merging companies circulate for those meetings in relation to valuation?

Section 232(2) requires circulating the expert's valuation report, if any, together with the directors' report that explains the effect on each class of shareholders and lays out the share exchange ratio and any special valuation difficulties. This is done for the meetings ordered by the Tribunal, not after sanction.

  1. AOnly a valuer's certificate sent to the Registrar after sanction
  2. BThe report of the expert with regard to valuation, if any, along with a directors' report explaining the effect on each class of shareholders and the share exchange ratio, specifying any special valuation difficultiesCorrect
  3. COnly the due diligence report prepared by the transferee company
  4. DA statement by the Tribunal fixing the exchange ratio

Explanation

Section 232(2) requires circulation of the draft scheme, confirmation of filing with the Registrar, the directors' report covering the share exchange ratio and special valuation difficulties, and the expert's valuation report, if any. The ratio is not fixed by the Tribunal, and circulation is for the meetings, not after sanction.

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