Secretarial practice

Bibliographic data

Monograph

Identifikator:: 1828236004

URN:: urn:nbn:de:zbw-retromon-249926

Document type:: Monograph

Title:: Secretarial practice

Edition:: fourth edition

Place of publication:: Cambridge

Publisher:: W. Heffer & Sons Ltd

Year of publication:: 1930

Scope:: viii, 987 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XIX. Reconstruction and schemes of arrangements

Collection:: Economics Books

RECONSTRUCTION 221 shareholders, there is nothing to prevent such a scheme going through, illegal though it may be, and plenty of such schemes have been carried out even since Bisgood's Case. As regards amalgamations, it is only necessary to state that they are in general effected either by means of proceedings under s. 234 or by a purchase of shares. Where the amalgama- tion is effected under s. 234, the process where Company A is absorbed by Company B will be a single sale; or where a new company acquires the undertakings of both Company A and Company B, there will, of course, be an independent sale by cach. The law is the same, and the difficulties are the same as in simple reconstructions, and need not be further com- mented on. As regards amalgamation by a purchase of shares, this amounts simply to the acquisition of all, or, if it is merely desired to be able to pass an extraordinary resolution, at least three-fourths of the shares of the company. Sometimes, however, the acquisition is limited to those classes of shares which carry full voting rights. This method of amalgamation has become increasingly popular, both because it preserves the names and thus the goodwill of the original companies and, at any rate prior to the coming into force of s. 55 of the Finance Act, 1927, because it avoided the duty under s. 112 of the Stamp Act, 1891 involved in the formation of a new company. A common method of procedure is for an agreement to be entered into with the directors of the company the shares of which it is desired to acquire on behalf of themselves and all other members of that company who ratify the agreement, the agreement being made conditional on ratification within a fixed period by an agreed majority. The directors then circularise the shareholders and if the requisite majority ratify within the time limited, the agree- ment becomes absolute. This form of amalgamation is recognised by s. 155 of the Act of 1929, under which if a scheme or contract involving the transfer of shares or any class of shares in a company (called ‘the transferor company’) to another company, whether a company within the meaning of the Act or not (called ‘the transferee company’), has within four months of the offer being made been approved by the holders of at least nine-tenths in value of the shares affected, the transferee company may, on notice given in the prescribed manner to any dissenting shareholder within two months, after the expiration of the above period of four months, purchase the shares held by any dissenting share- holder upon the terms specified in the scheme or contract. The expression ‘dissenting shareholder’ includes any share- Amalgama- tions. Amalgama- {ion by share purchase.

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