Shyam Babu Gautam, Member (Technical)
1. The Advocates for the Applicant Companies states that the present Scheme is a Scheme of Amalgamation and Arrangement of TG Terminals Private Limited (“Transferor Company”) with Transworld Terminals Private Limited (“Transferee Company”) and their respective Shareholders under the provisions of Section 230 read with Section 232 and other applicable provisions of the Companies Act, 2013 and the Rules made thereunder.
2. The Applicant Transferor Company is primarily engaged in the business of handling and storage of EXIM containers, customs handling of EMIX cargo, general warehousing, bonded warehousing, handling of LCL import cargo, MT container handling, containers repairs and maintenance and other inspection services.
3. The Applicant Transferee Company is primarily engaged in the business of Container Freight Stations, Contract Logistics (3PL & Cold Chain Solutions) and Freight Forwarding.
4. The Advocates for the Applicant Companies submits that the Board of Directors of the Applicant Transferor Company and the Applicant Transferee Company had approved the Scheme of Amalgamation and Arrangement vide its respective Board Resolutions dated November 8, 2021. The Board Resolutions approving the Scheme for the Applicant Companiesand are annexed as Exhibit G1 and Exhibit G2 to the Application.
5. The Advocates for the Applicant Companies submit that the Appointed Date of the Scheme of Amalgamation and Arrangement is 1st April 2022.
6. The Advocates for the Applicant Companies further submit that rationale for Scheme is as under:
i. The Transferor Company and the Transferee Company are engaged in the business of Container Freight Station and other allied services. The amalgamation will ensure creation of a combined entity hosting all value -added product and services under the Transferee Company, as holding entity of the cluster. It will provide several benefits including but not limited to synergy, economies of scale, attain operational efficiencies, cost competitiveness etc. it is intended that the Transferor Company be merged with Transferee Company. The Scheme of Amalgamation and Arrangement would inter alia achieve the following benefits:
a. Simplification of the group structure
b. Consolidation and streamlining the financial and operational resources for a better and more efficient usage as the integration would result in greater financial strength and flexibility for the Transferee Company, which would result in maximizing overall shareholder value, and will improve the competitive position of the combined entity;
c. Reduction in managerial overlaps due to operation of multiple entities and more focused leadership;
d. Reduction in multiplicity of legal and regulatory compliances, reduction in overheads, including administrative, managerial and other costs amongst all;
e. Synergy benefits, such as, competitive edge, enhancement of net worth of the combined business to capitalize on future growth potential and would in turn significantly help in efficient utilization of financial and operational resources and facilities of the combined entity and improve the competitive position and negotiating power of the combined entity;
f. Financial, managerial, and technical resources, personnel, capabilities, skills, expertise and technologies of each of the companies pooled in the merged entity, will lead to optimum use of infrastructure, cost reduction and efficiencies, productivity gains and logistic advantages and reduction of administrative and operational costs, thereby significantly contributing to the future growth and maximising shareholder value.
g. Greater efficiency in cash and debt management and unfettered access to cash flow generated by the combined business, which can be deployed more efficiently, to maximise shareholders value and better debt management;
h. Simplification of management structure, elimination of duplication and multiplicity of compliance requirements, rationalization of administrative expenses, better administration and cost reduction (including reduction in administrative and other common costs);
i. Further expanding the business of the Transferee Company into growing markets
j. Efficient tax planning at the combined entity level.
ii. In view of the aforesaid objectives, the Board of Directors of the Transferor Company and the Transferee Company have considered and proposed the amalgamation for the transfer and vesting of the Undertaking of the Transferor Company (as defined hereunder) and business of the Transferor Company with and into the Transferee Company and other matters herein, with an opinion that the amalgamation and other provisions of the Scheme would benefit the shareholders, employees and other stakeholders of the Transferor Company and the Transferee Company.
7. The Advocates for the Applicant Companies further submit that coming into effect of this Scheme and in consideration of the amalgamation of the Transferor Company into and with the Transferee Company, the Transferee Company shall, without any further application, act or deed, issue and allot to the shareholders of the Transferor Company, equity shares in the following ratio (“Share Exchange Ratio”):
"11 (Eleven) fully paid-upequity shares of Rs. 100/- each of the Transferee Company shall be issued and allottedfor every 1000 (Thousand) fully paid-up equity shares ofRs. 10/- each held in the Transferor Company."
8. The Advocates for the Applicant Companies submits that in the Transferor Company there are 3(Three) Equity shareholders holding 100% value of the issued equity share capital and the said 3(Three) Equity Shareholders have submitted their consent affidavits for dispensation of convening the meeting of the Equity Shareholders of the Applicant Transferor Company, for adopting the proposed Scheme of Amalgamation and Arrangement.The said Consent affidavits submitted by the Equity Shareholders are annexed as Exhibit J-1, J-2, J-3 (page number 218-222) to the Application. In view of the fact that the shareholders have given their consent affidavits, the meeting of the Equity Shareholders of the Transferor Company is hereby dispensed with.
9. The Advocates for the Applicant Companies submits that the Applicant Transferee Company has 2(Two) Equity shareholders holding 100% value of the issued equity share capital and the said 2 (Two) Equity Shareholders have submitted their consent affidavits for dispensation of convening the meeting of the Equity Shareholders of the Applicant Transferee Company, for adopting the proposed Scheme of Amalgamation and Arrangement. The said Consent affidavits submitted by all the Equity Shareholders are annexed as Exhibits L-1and L-2 (page number 224-227) to the Application. In view of the fact that the shareholders have given their consent affidavits, the meeting of the Equity Shareholders of the Transferee Company is hereby dispensed with.
10. The Advocates for the Applicant Companies submit that the Applicant Transferor Company does not have any preference shareholders, therefore, the question of convening the meeting of preference shareholders does not arise.
11. The Advocates for the Applicant Companies submit that the Applicant Transferee Company does not have any preference shareholders, therefore, the question of convening the meeting of preference shareholders does not arise.
12. The Advocates for the Applicant Companies submit that there are no Secured Creditors of the Applicant Transferor Company, hence, no meeting can be convened.
13. The Advocates for the Applicant Companies submit that the present scheme is an arrangement between the Applicant Companies and their respective shareholders as contemplated under Section 230(1)(b) of the Companies Act, 2013 as there is no compromise or arrangement with the Secured Creditors of the Transferee Company. Therefore, no meeting of the Secured Creditors of the Transferee Company needs to be convened. However, Applicant Transferee Company is directed to issue notice by Courier/Registered Post/Speed Post/ Hand Delivery or through e-mail to all its Secured Creditors under section 230(3) of the Companies Act, 2013 with a direction that they may submit their representation, if any, within a period of thirty (30) days from the date of receipt of such notice to the Tribunal and a copy of such representation shall simultaneously be served upon the Transferee Company, failing which, it shall be presumed that the Secured Creditors have no representations to make on the proposed Scheme.
14. The Advocates for the Applicant Companies submits that the present scheme is an arrangement between the Applicant Companies and their respective shareholders as contemplated under Section 230(1)(b) of the Companies Act, 2013 as there is no compromise or arrangement with the Unsecured Creditors of the Applicant Transferor Company and Applicant Transferee Company. Therefore, no meeting of the Unsecured Creditors of the Applicant Transferor Company and Applicant Transferee Company needs to be convened. However, the Applicants Transferor and Transferee Company is directed to issue notice by Courier/Registered Post/Speed Post/ Hand Delivery or through e-mail to all its Unsecured Creditors under section 230(3) of the Companies Act, 2013 with a direction that they may submit their representation, if any, within a period of thirty (30) days from the date of receipt of such notice to the Tribunal and a copy of such representation shall simultaneously be served upon the Applicants Transferor and Transferee Company, failing which, it shall be presumed that the Unsecured Creditors have no representations to make on the proposed Scheme.
15. The Applicant Companies are directed to serve notices along with copy of the Scheme upon the following statutory authorities pursuant to Section 230(5) of the Companies Act, 2013 read with Rule 8 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016:- (i) concerned Income Tax Authority within whose jurisdiction the Transferor Company’s assessments are made AAFCT5369P and the Transferee Company’s assessments are made AAACM3711H (ii) The Central Government through the office of Regional Director, Western Region, Ministry of Corporate Affairs, Mumbai; (iii) The Registrar of Companies, Mumbai with a direction that they may submit their representations, if any, within a period of 30 (Thirty) days from the date of receipt of such notice to the Tribunal with copy of such representations shall simultaneously be served upon the Applicant Companies, failing which, it shall be presumed that the statutory authorities have no representations to make on the proposal.
16. The Applicant Companies are also directed to serve notice along with a copy of the scheme upon the Official Liquidator, High Court, Bombay pursuant to Section 230(5) of the Companies Act, 2013. If no response is received by the Tribunal from the Official Liquidator within thirty days of the receipt of notice, it will be presumed that the Official Liquidator has no objection to the proposed scheme as per Rule 8 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.
17. The Applicant Companies to file an affidavit of service in the Registry proving dispatch of notice to the Creditors and service of notice to the regulatory authorities as stated in the above clauses and do report to this Tribunal that the directions regarding the issue of notices have been duly complied with.
