H.P. Chaturvedi, Member - (1.) The Petitioner Companies tiles Joint application under Section 230-232 of the Companies Act, 2013 read with National Company Law Tribunal Rules, 2016 along with the Companies (Compromise, Arrangements and Amalgamations Rules), 2016, praying for approval and sanction of the proposed Scheme of Arrangement for the Amalgamation of AUXIN ENGINEERING LIMITED (Petitioner No. 1) UPHILL FARMS PRIVATE LIMITED (Petitioner No. 2) and OASIS GRASSLAND PRIVATE LIMITED (Petitioner No. 3).
(2.) The Petitioner Company further submits that the Board of Directors of the Petitioner Companies in its meeting held on March 24, 2017 has already approved the proposed Company Scheme.
(3.) The main object, salient features as well as rationale of the proposed Scheme of amalgamation is described as under: i. The de-merger of Project Division Undertaking is likely to enable the business activities to be pursued and carried on with greater focus and attention through two separate entities each having its own independent administrative set-up. This will ensure required depth and focus on each of the businesses and adoption of strategies necessary for the growth of the respective businesses. ii. The Board of Directors of the Companies believe that each of the said businesses are distinct and diverse in their growth trajectories, risk profile, maturity stage, and requirement of funds and thereby require entirely different approaches. The proposed scheme of arrangement will enable the management to achieve the desired objectives and address diverse needs of the said businesses to be able to unlock greater value for the stakeholders of all the Companies in future; iii. It will also help in simplification and rationalization of the holdings structure and reduction in corporate shareholding tiers; iv. The proposed business reorganisation will also provide the independence to the management in decision making regarding the use of the cash flows, capital expenditure and other reinvestment in respective businesses; v. Achieve greater efficiencies in operations through carve out of the Project Division Undertaking of Uphill under a separate entity which has more flexibility in terms of organizing the internal management of the business and provide optimal exploitation, monetization and development of such business but with simplified compliance requirements under the applicable laws; and vi. The activities of each of the business undertakings will be carried on more economically, conveniently and advantageously post restructuring and the same will have beneficial results for the said companies, their shareholders, stakeholders and all concerned vii. That the amalgamation of Petitioner Company No. 1 with Petitioner Company No. 1 with Petitioner Company No. 22 and the De-merger of the Project Division Undertaking of Petitioner Company No. 3/Resulting Company would be in the best interest of the shareholders, creditors and employees of the Transferor Company, Transferee Company and Resulting Company. viii. That pursuant to this Scheme of Arrangement, all the shareholders of the Transferor Company will get shares in the Transferee Company and there would be no change in the economic interest for any of the shareholders of the Transferor Company pre and post implementation of the Scheme. Valuation Report given by J.N. Sharma, Chartered Accountant on the share exchange ratio which has already been annexed as Annesure-17 to Company Application No. 43/ALD/2017. The salient features of the Scheme are as under: i. That the Scheme proposes the Amalgamation of Auxin Engineering Limited with Uphill Farms Private Limited, and ii. Thc Demerger of the "Project Division Undertaking" of Uphill Farms Private Limited into Oasis Grassland Private Limited. iii. That the Appointed Date under the Scheme is the commencement of the business hours on 01.04.2017. iv. That the share exchange ratio proposed in the Scheme of Arrangement for Amalgamation of Transferor Company with Transferee Company has been set out at Clause [2.6] of the Scheme, which reads as under: "1 (one) Equity share of the face value of Rs. 10/- each in the Transferee Company credited as fully paid-up for every 1 (one) Equity share of the face value of Rs. 10/- each held in the Transferor Company ("Share Exchange Ratio ") v. That the share exchange ratio proposed in the Scheme of Arrangement for Demerger of Project Division Undertaking of Demerged Company into Resulting Company has been set out at Clause [3.11 ] of the Scheme, which reads as under: "1 (One) Equity share of the face value of Rs. 10/- each in the Resulting Company credited as fully paid-up, for every 1 (One) Equity Share of the face value of Rs. 10/- each held in the Demerged Company ("Share Exchange Ratio ") vi. That the Scheme provides that the Transferee Company shall account for the transfer and vesting of the Assets and Liabilities of Transferor Company as specified in clause 2.8 of the Scheme. vii. That the Scheme provides that the Demerged Company and Resulting Company shall account for the transfer and vesting of the Project Division Undertaking of Demerged Company into Resulting Company as specified in clause 3.12.2 and 3.12.1 of the Scheme respectively.;