Corporate Restructuring

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This presentation enumerates the practical aspects of merger, demerger and reduction of capital and the strategies involved therein. It also highlights certain key issues involved in corporate restructuring.

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<ul><li> 1. CORPORATE RESTRUCTURING Pavan Kumar Vijay</li></ul> <p> 2. GOVERNING PROVISIONSECTION 391-394 of Companies Act, 1956 Most liberal sections in the entireCompanies Act, 1956.By way of SCHEME you canpropose &amp; achieve whatever you want 3. TYPES OF RESTRUCTURING REDUCTION OF CAPITAL MERGER DEMERGER 4. RESTRUCTURING BIFR High Court Approving Authorities 5. MERGER Combining of two or more commercial organizations into one in order to increase efficiency and sometimes to avoid competition . MERGER REVERSE MERGER As a commercial term, it means when a Healthy Company (in terms of size, capital or listing status)is merging in a Weak Company (in terms of size, or unlisted). SECTION 391-394 of Companies Act, 1956 6. DEMERGER Divisionof a Company with two or more identifiable business units into two or more separate companies SECTION 2(19AA) of Income Tax Act, 1961. 7. Extinguishing or Reducing the paid-up capital, Securities Premium Account or liability of members with respect to their unpaid calls -AN EFFECTIVE WAY OF INTERNAL RESTRUCTURING REDUCTION OF CAPITAL SECTION 100 105 of Companies Act, 1956 SECTION 100 to 105 of Companies Act, 1956 8. A FEW VARIETY OF MERGER </p> <ul><li>Unlisted with Listed </li></ul> <ul><li>Listed with Unlisted</li></ul> <ul><li>Merger of Subsidiary with Holding Company </li></ul> <ul><li>Merger with Group Company </li></ul> <ul><li>Healthy Company with Weak Company </li></ul> <ul><li>Merger through BIFR </li></ul> <p> 9. STOCK EXCHANGES ROLE REQUIREMENTS Listing Agreement Compliances Stock Exchange Internal Norms Observations Compliance ofSecurities laws Compliance ofCompanies Act 10. O </p> <ul><li>Valuations Analysis </li></ul> <ul><li>No undue benefit to Promoters /</li></ul> <ul><li>Particular group </li></ul> <ul><li>Investors interest not to be affected </li></ul> <ul><li>Back door Entry for listing</li></ul> <ul><li>Change in Management/Control </li></ul> <p>RVATIONS BSE 11. MERGER THROUGH BIFRAN EFFECTIVEWAY TOREVIVEYOURSICK COMPANY 12. MERGER THROUGH BIFR</p> <ul><li>Single window clearance for a legal formalities</li></ul> <ul><li>under Companies Act; </li></ul> <ul><li>Relaxation in compliance with Income Tax</li></ul> <ul><li>related compliances; </li></ul> <ul><li>Tax breaks and similar other benefits; </li></ul> <ul><li>Exemption from SEBI Takeover Code </li></ul> <p> 13. REDUCTION OF CAPITAL 14. Types of Reduction of Capital Writing off Losses &amp;Fictitious Assets Correction of Over- Capitalization Distinguishment of the Liability in respect of unpaid portion of face value.Distribution of accumulated profits by Payment to shareholders a part of share capital. 15. Reduction of Capital- A Strategic Step To Clean-up the Balance Sheet To rationalize the capital base Revival of Sick Company 16. LISTING</p> <ul><li>Direct listing is costly &amp; complicated </li></ul> <ul><li>But Listing of Company provides for..</li></ul> <ul><li>Unlocking value of business </li></ul> <ul><li>Brings liquidity </li></ul> <ul><li>Attractinvestors for further growth </li></ul> <p> 17. </p> <ul><li>Restructuring offers tremendous opportunities for companies to grow &amp; add value to the shareholders </li></ul> <ul><li>It unlocks the true potential of the company </li></ul> <ul><li>It is a Strategy for Growth &amp; Expansion </li></ul> <ul><li>It also helps in Cleaning up &amp;</li></ul> <ul><li>create Synergy of Resources </li></ul> <p>To sum up 18. Our Clients MERGER Visesh Infotecnics Ltd MERGER CHD Developers Ltd DEMERGER NIIT Ltd. MERGER Surya Vinayak Industries MERGER Anant Raj Industries MERGER Wrigley India Pvt. Ltd 19. Our Clients MERGER Shivalik Global Ltd MERGER SMC Global Securities Ltd MERGER Seasons Textiles Ltd MERGER OF FIRMS WITH COMPANY Mira Exim Ltd MERGER Reheja Design &amp; Contract MERGER Amar Ujala Publication 20. Our Clients Reorganization of Capital Structure Potentially Sick Company Wiping out Past Losses by OTS with Banks and Reduction of Paid-up Capital Pashupati Acrylone Ltd. Reorganization of various Reserves and improving the Capital Structure of the Company Triton Corp Ltd Potentially Sick Company Wiping out Past Losses by OTS with Banks and Reduction of Paid-up Capital Ashnoor Textiles Ltd Sick Company Revival Reorganisation of Loans and Equity to wipe-out past lossesHaryana Petrochemicals Ltd. 21. Thanks a lot Pavan Kumar Vijay Corporate Professionals (India) Pvt. Ltd 7/9, Sarvpriya Vihar, New Delhi 1100016 Tel: +91 11 26966100, Fax: +91 11 26967100 Email:info@indiacp.com Visit us at: www.corporateprofessionals.com </p>