Compulsory Acquisition (S.236)

Question 1

What are the rquirements for acquiring minority shareholder’s shares u/s .236?

Answer 1

Acquirer +PAC hold more than 90% of the issued share capital of the company.
OR
group of persons coming together who hold more than 90% of issued share capital.
Acquirer can be individual

Question 2

What are further requirements that required u/s .236

Answer 2

the PAC should share common objective along with the acquirer.

Question 3

What all kinds of acquisition can take place under this section?

Answer 3

1. Amalgamation
2. share exchange
3. conversion of securities by virtue of SPA.

Adani ndtv merger (conversion of securities by virtue of SPA.)

Question 4

Which provision provides for valuation of the dissenting shareholder shares in an unlisted company?

Answer 4

Rule 27 of Companies (Compramise arrangement and amlagamation rules)

Question 5

Which provision provides for valuation of the dissenting shareholder shares in an listed company?

Answer 5

Sebi takeove regulations

Question 6

Can the dissenting shareholders voluntarily offer majority shareholders to purchase their share?

Answer 6

Yes, under section 236(3) they can.

Question 7

is there any remedy for dissenting shareholders against compulsary acquisition of the companies?

Answer 7

yes, U/S 236 dissenting shareholder holding 1/10 shareholding can approach tribunal under opression and missmanagement.

No remedy for minority shareholders unless there is substantial evidence of mismanagement.