THE HON’BLE SRI JUSTICE N.V. RAMANA C.P. Nos. 77 and 78 of 2009 Common order: M/s. Max Infratech (India) Private Limited and M/s. UAN Max Infra Limited, which are incorporated under the provisions of the Companies Act, 1956, in the State of Andhra Pradesh, with their Registered Offices at H. No. 8-2-348/2, Road No.3, Besides Administrative Staff College, Banjara Hills, Hyderabad, have filed these two company petitions under Sections 391 and 394 of the Companies Act, 1956, praying to sanction the scheme of amalgamation between them. The authorized share capital of M/s. Max Infratech (India) Private Limited (hereinafter referred to as ‘the Transferor Company’) is Rs.15,00,00,000/- divided into 1,50,00 000 equity shares of Rs.10/- each. Its present issued, subscribed and paid up capital is Rs.15,00,00,000/- divided into 1,50,00,000 equity shares of Rs.10/- each fully paid up. Apart from the above, there is share application money of Rs.55,80,696/- pending allotment. The main objects with which the Transferor Company was incorporated, as evident from its Memorandum of Articles of Association, is to construct, build, develop, maintain, operate, own and transfer infrastructure facilities, including, housing, roads, highways, bridges, etc.; to carry on the business of all types of contract works and infrastructure projects with Government semi-government and private parties etc.; to carry on the business of contractors, sub-contractors, quasi contractors, whether for government or semi-government etc.; to purchase acquire, take on lease or in exchange or in any other lawful manner any area, land, buildings, structures and turn the same into account, develop the same and dispose of etc., and to lay out, develop, construct, build, erect, demolish, re-erect, alter re-model etc. The authorized share capital of M/s. UAN Max Infra Limited (hereinafter referred to as ‘the Transferee Company’) is Rs.15,00,00,000/- divided into 1,50,00,000 equity shares of Rs.10/- each. Its present issued, subscribed and paid up capital is Rs.15,00,00,000/- divided into 1,50,00,000 equity shares of Rs.10/- each. The main objects with which the Transferee Company was incorporated, as evident from its Memorandum of Articles of Association, is to carry on the business of undertaking of all types of civil, electrical and mechanical works, civil constructions, construction of projects etc.; to carry on the business of developing, maintaining and operating of any other facility that may be noticed in future as infrastructure facility either by the State Governments and/or the Government of India etc.; to tender, enter into agreements, undertake, organize and execute construction of all types of tunnels, bridges minor and major etc.; to acquire and take over the whole business of M/s. U.A.N. Raju (a proprietary concern) and to acquire land and property by purchase, lease or otherwise etc. Considering the identical nature of businesses carried on by the Transferor and Transferee Companies, to have greater integration and greater financial strength, which would result in maximizing overall shareholder value and improve the competitive position, and to have synergy of operations in areas such as technical know-how, marketability and logistics, it was proposed to amalgamate the Transferor Company with the Transferee Company, so that the merger will enlarge the capital base and infuse higher expertise in the merged entity enabling it to bid for larger and more valued projects, which will not only benefit the shareholders, but also its employees, stakeholders and public at large. The Board of Directors of the Transferor and Transferee Companies in their respective meetings held on 17.02.2009 and 18.03.2009, have approved the scheme of amalgamation, subject to approval by the requisite majorities/consent of the members of the Transferor and Transferee Companies, and subject to obtaining all sanctions and orders of the Court. As the shareholders of the Transferor and Transferee Companies, have given affidavits expressing their no objection to the scheme of amalgamation, the Transferor and Transferee Companies filed applications in C.A. Nos. 303 and 304 of 2009 respectively, praying to dispense with the convening of the meetings, and this Court by order dated 01.04.2009 dispensed with the convening of the meeting of the shareholders of the Transferor and Transferee Company. Thereafter, the Transferor and Transferee Companies have filed these Company Petitions, praying to sanction the scheme of amalgamation, as approved by their Board of Directors and shareholders, to be binding on the Transferor and Transferee Companies and their members/shareholders and creditors. On 16.06.2009, this Court while admitting the Company Petitions, directed issuance of notice to the Central Government and the Official Liquidator, and as directed the Transferor and Transferee Companies took out notices by way of paper publication in Business Standard and Andhra Bhoomi of Hyderabad edition and filed proof of service into Court. On behalf of the Central Government, the Registrar of Companies, Andhra Pradesh, filed common affidavit. It is stated that on instructions received from the Regional Director, Ministry of Corporate Affairs, Chennai, the scheme may be considered subject to production of consent letters from the creditors in respect of secured and unsecured loans availed by the Transferor and Transferee Companies. Taking similar objection, as raised by the Central Government, the Official Liquidator filed report. To satisfy the objections taken by the Central government and the Official Liquidator, the Transferor Company a Memo along with the “No Objection” letters received from its secured creditors, namely M/s. Axix Bank, M/s. State Bank of India, M/s. ABN Amro Bank, M/s. HDFC Bank Limited, M/s. Srei Equipment Finance Private Limited, M/s. Sundaram Finance Limited, M/s. TML Finance Limited, M/s. L & T Finance Limited and M/s. Kotak Mahindra Primus Limited, and the letter received from its unsecured creditor, namely M/s. G.H. Reddy and Associates (Construction) Private Limited. Likewise, the Transferee Company, also filed a Memo along with the “No Objection” letters received from its secured creditors, namely M/s. ICICI Bank Limited, M/s. HDFC Bank Limited, M/s. Kotak Mahindra Bank Limited, M/s. Sundaram Finance Limited, M/s. TML Financial Services Limited, M/s. Tata Capital Limited, M/s. Srei Infrastructure Finance Limited, M/s. Blue Rock Infra Projects Pvt. Ltd., M/s. Sri Krishna Constructions, M/s. Balaji Constructions, M/s. Sri Ramana Enterprises, M/s. Hastah Finances Limited, M/s. UTI Bank Limited and M/s. Indian Bank and also of the unsecured creditor namely M/s. State Bank of India, IFB. Heard the learned counsel for the petitioners-Transferor and Transferee Companies, the learned Assistant Solicitor General for the Central Government and the learned counsel for the Official Liquidator and perused the proposed Scheme of Amalgamation between the Transferor and Transferee Companies. As can be seen from the Memorandum of Articles of Association of the Transferor and Transferee Companies, they are engaged in similar type of businesses. With a view to maximize overall share holder value and improve competitive position for combined entitle, and to have synergy of operations in areas such as technical know how marketability and logistics and enlarge the capital base and infuse higher expertise and to enable to bid for larger and more value projects, the scheme of amalgamation has been proposed, whereunder the Transferor Company is sought to be amalgamated with the Transferee Company. The Board of Directors of the Transferor and Transferee Companies, considering the benefits of the scheme, which is in the interest of the shareholders, secured and creditors and employees, have in their respective meetings held on 17.02.2009 and 18.03.2009, approved the scheme of amalgamation subject to approval of the shareholders. The shareholders of the Transferor and Transferee Companies, as noticed earlier, have filed affidavits expressing their ‘No Objection’ to the scheme of amalgamation, and considering such affidavits, this Court by order dated 01.04.2009, passed in C.A. Nos. 303 and 304 of 2009, has dispensed with the convening of their meetings. This apart, pursuant to the notice ordered by this Court, the Central Government and Official Liquidator filed affidavit and report, stating that the Transferor and Transferee Companies, have obtained loans from secured and unsecured creditors, and they have to obtain their consent to the scheme of amalgamation. Complying the said objection, the counsel for the petitioners filed Memos accompanied by affidavits of the secured and unsecured creditors of the Transferor and Transferee Companies, expressing their ‘No Objection’ to the scheme of amalgamation. The scheme of amalgamation apart from being beneficial to the shareholders, also seeks to protect the services of the workers/employees, and upon verification of the information and material furnished, it is reported by the Central Government and the Official Liquidator that the affairs of the Transferor Company, have not been conducted in a manner prejudicial to the interests of its members or to public interest. Since the shareholders, secured and unsecured creditors, and others interested in the affairs of the Transferor and Transferee Companies, have not expressed any objection to the scheme of amalgamation, and having regard to the fact that scheme protects the employment of the workers/employees of the Transferor Company, and the Central Government and the Official Liquidator having reported that the affairs of the Transferor Company have not been conducted in a manner prejudicial to the interests of its members or to public interest, I am of the considered opinion that this Court also should not have any objection to the sanction of the scheme of amalgamation. Hence, the scheme of amalgamation, as approved by the Board of Directors and shareholders of the Transferor and Transferee Companies, is approved. As a consequence thereof, the Transferor Company shall stand dissolved and merge with the Transferee Company, with all its assets and liabilities. The petitioner shall serve certified copy of this order on the Registrar of Companies, Andhra Pradesh, Hyderabad, within a period of 30 days from the date of its receipt. The petitioners shall pay to the Assistant Solicitor General and the counsel for the Official Liquidator, a sum of Rs.3,000/- each towards costs. Accordingly, the Company Petitions are allowed. __________________ N.V. RAMANA, J Dated: 19th November, 2009 KSR