Decided on April 19,2016

Messer Holdings Ltd. Appellant
Shyam Madanmohan Ruia And Others Respondents


- (1.) Messer Griesham GmbH, a German Company (hereinafter referred to as "MGG") entered into a Share Purchase and Cooperation Agreement (hereinafter referred to as AGREEMENT-1) with the shareholders of an Indian company called Goyal Gases Ltd. (hereinafter referred to as "GGL") on 12.5.1995. By virtue of the said agreement, MGG purchased 30% of equity shares of GGL. Subsequently, MGG increased its shareholding in GGL to 49%. Clause 9 of the AGREEMENT-1 reads: " 9. NON-COMPETITION CLAUSE GGL and all Goyal Group companies will cooperate in the Indian market with right to first refusal basis/with MGG and will not for the duration of this cooperation support in any way directly or indirectly - the activities of MGG's competitors with regard to gas business. MGG will give written information to GGL about every business opportunity it plans to take in the Indian market in regard to industrial gases and related business and GGL may decide if it wants to participate in it (right of first refusal). In case GGL does not within a period of two months after receiving MGG's notice declare in writing that it is willing and able to participate in the planned business, MGG is free to proceed with this business on its own. However, MGG will give due consideration to the interest of GGL being its group company. Such new business which MGG undertakes should be business of gas supply of few major dedicated customers only and not to general market supply."
(2.) In a company known as BOMBAY OXYGEN CORPORATION LIMITED (hereinafter referred to as the 'BOCL') majority shares were collectively held by a group of persons known as RUIAS (we understand that they belong to one family). On 23.6.1997, MGG entered into another Share Purchase Agreement (hereinafter referred to as AGREEMENT -II) with RUIAS. By the said agreement MGG agreed (i) to purchase 45001 shares of BOCL from RUIAS, and (ii) also to acquire another 30000 shares of BOCL from the open market which would make MGG the majority shareholder of BOCL (creating a controlling interest). Clause 6.1 of AGREEMENT-II reads; "6.1 Right of First Refusal: With effect from the date this Agreement becomes effective, neither party shall sell any shares in the Company held or acquired by it without first, offering the Shares to the other party. The offer shall be in writing and shall set out in the price and other terms and conditions. If the offeree does not agree to purchase the Shares so offered the offerer shall be free to sell the Shares to any person (other than a competitor of the offeree), but at the same price and on the same terms as offered to the offeree. This right of first refusal does not apply to any sale of shares by the purchaser to a company of the Hoechst Group. In a company directly or indirectly controlled by or under direct or indirect common control with the Hoechst Group. For the purposes of this definition "control" means ownership, directly or indirectly or more than 50 percent of the issued and outstanding voting stock or ownership interest of the Company."
(3.) Pursuant to the AGREEMENT-II, MGG made a public announcement on 27.6.1997 disclosing its intention to acquire 30000 shares of BOCL from public as required under Chapter-III of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as the 'REGULATIONS 1997) framed in exercise of the powers conferred by Section 30 of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the "SEBI Act");

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