IN THE HIGH COURT OF JUDICATURE ANDHRA PRADESH AT HYDERABAD WEDNESDAY THE FIRST DAY OF DECEMBER TWO THOUSAND AND TEN PRESENT THE HON’BLE MS. JUSTICE G. ROHINI COMPANY APPLICATION Nos. 1471 & 1472 of 2010 CA.No. 1471 of 2010 M/s. White Star Alums Pvt.Ltd., A Company Incorporated under the Companies Act Having its Regd. Office at Plot No. 74/A Second Floor, Central Bank Building, Kalyan Nagar, Hyderabad Represented by its Director, Mrs. I. Shyamala … Applicant-Transferor Company CA.No. 1472 of 2010 M/s. Sreepathi Pharmaceuticals Ltd., A Company incorporated under the Companies Act Having its Regd.Office at Plot No. 22-B, Road No.2, Jubilee Hills, Hyderabad Represented by its Managing Director, Sri I. Srinivas … Applicant-Transferee Company The Court made the following order : Order follows on 2nd page THE HON’BLE Ms. JUSTICE G.ROHINI COMPANY APPLICATION No.1471 OF 2010 AND COMPANY APPLICATION No.1472 OF 2010 COMMON ORDER : The applicant in C.A.No.1471 of 2010 is M/s. White Star Alums Private Limited (hereinafter referred to as ‘the Transferor Company’). The applicant in C.A.No.1472 of 2010 is M/s. Sreepathi Pharmaceuticals Limited (hereinafter referred to as ‘the Transferee Company’). These two applications are filed under Sections 391 and 394 of the Companies Act, 1956 read with Rule 9 of the Companies (Court) Rules, 1959 seeking to dispense with the convening of the meeting of the shareholders of the applicant companies for consideration of the proposed Scheme of Amalgamation between the Transferor and the Transferee Companies. The Transferor Company was incorporated as a Private Limited Company in the State of Andhra Pradesh on 31.08.1995 under Certificate of Incorporation No.01-21575 of 1995-1996. The registered office of the Transferor Company is situated at Plot No.74/A, 2nd Floor, Central Bank Building, Kalyan Nagar, Hyderabad. The present authorized share capital of the Transferor Company is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each and the issued, subscribed and paid up capital of the Transferor Company is Rs.10,80,000/- divided into 1,08,000 shares of Rs.10/- each. Apart from the above, there is a share application money pending allotment to an extent of Rs.3,41,63,890/-. The main objects of the Transferor Company inter alia provides for to carry on the business of manufacturing and/or to buy, sell, import, export, deal in, as agents, stockists, distributors and/or to otherwise deal in alum and allied chemical products. The Transferee Company was originally incorporated under the name and style of M/s. Sreepathi Pharmaceuticals Private Limited in the State of Andhra Pradesh on 29.12.1983 under the Certificate of Incorporation No.4356 of 1983-84. Later on the company became a Public Limited Company in terms of Section 31 (1) / 44 of the Companies Act, 1956 and had obtained a fresh Certificate of Incorporation consequent on its conversion from the Registrar of Companies, Andhra Pradesh on 13.5.1992 after complying the necessary formalities under Companies Act, 1956. The registered office of the Transferee Company is situated at Plot No.22B, Road No.2, Jubilee Hills, Hyderabad. The authorized share capital of the Transferee Company as on 31.3.2010 is Rs.4,00,00,000/- divided into 4,00,000 equity shares of Rs.100/- each. The issued, subscribed and paid up capital of the Transferee Company as on 31.3.2010 is Rs.3,69,63,900/- divided into 3,69,639 equity shares of Rs.100/- each. The main objects of the Transferee Company inter alia provides for to carry on manufacture, research, design and dealership of organic and inorganic chemicals, pharmaceuticals and etc., (morefully described in para-5 of C.A.No.1472 of 2010). It is stated that the Transferee Company is a subsidiary of the Transferor Company and amalgamation of both the companies has been proposed in order to take advantage of infrastructural facilities of the Transferor Company, the Transferee Company after amalgamation would be in a position to diversity into various products at different locations in view of its existing infrastructure and capacity being utilized at optimum level. Further the proposed amalgamation would also benefit both the companies by rationalizing the activities of their respective products which will lead to economies of scale and also there would be reduction in over heads and other expenses and thus saving substantial amount. Further the proposed amalgamation would also enable the Transferee Company to position itself to withstand market fluctuations with diversified products and would also command large resources by virtue of larger capital base and reserves and would result in more sales with much better profitability. It is stated that in view of the advantages of amalgamation, the Board of Directors of the Transferor Company and the Transferee Company at their meeting held on 3.11.2010 approved the Scheme of Amalgamation of the Transferor Company with the Transferee Company w.e.f. 1.10.2010 subject to the approval/consent of the shareholders and confirmation by this Court. The salient features of the proposed Scheme of Amalgamation have been enumerated in para-14 of C.A.No.1471 of 2010 and it is stated that the four shareholders of the Transferor Company and the five shareholders in the Transferee Company had given their consent for approving the proposed Scheme of Amalgamation. The Transferor Company has not availed any secured loans except the unsecured loans in the form of sales tax deferment. So far as the Transferee Company is concerned, it has availed secured loans from Canara Bank towards the term loan and cash credit and from HDFC Bank towards the vehicle loan. It has also availed unsecured loans from its Transferor Company and there will be no objection to propose amalgamation from the said creditors as their interest will not be effected. Thus it is prayed by the Transferor and the Transferee Companies to dispense with the convening of the meeting of the shareholders of the respective companies. I have heard Sri V.S. Raju, the learned counsel for the applicants and perused the material available on record. Having regard to the facts and circumstances noticed above and keeping in view that there are only four shareholders in the Transferor Company and five shareholders in the Transferee Company and all of them had given their positive consent for the proposed Scheme of Amalgamation which is evident from the affidavits enclosed to the applications, I am convinced that there is no need for convening the meeting of the shareholders of the Transferor and Transferee Companies for the purpose of considering the proposed Scheme of Amalgamation. Accordingly, both the Company Applications are allowed as prayed for and convening of the meeting of the shareholders of the applicant companies is hereby dispensed with. _____________ G. ROHINI, J. Dt. 01.12.2010 ISL + GBS THE HONOURABLE MS. JUSTICE G. ROHINI COMPANY APPLICATION Nos. 1471 & 1472 of 2010 COMMON ORDER 01-12-2010 I s L