takeover of companies
atish singh
(Querist) 24 June 2008
This query is : Resolved
A LTD ACQUIRED 29 % STAKE IN C LTD.C LTD IS A LISTED COMPANY.B LTD ALREADY HOLDS 21 % STAKE IN C LTD.THERE ARE 7 DIRECTORS OF THE COMPANY .TWO OF THE ARE REPRESENTATIVE OF B LTD. AND FIVE ARE INDEPENDENT DIRECTORS. WHAT ARE THE STEPS TO BE TAKEN TO INDUCT THE REPRESENTATIVE OF A LTD INTO THE BOARD OF DIRECTORS OF C LTD.?
Manish Singh
(Expert) 24 June 2008
you must have proposed how many representatives u wish to induct in the board of dir. while entering into share purchase agreement.
so now just make an amendment in the articles of the company where you can put a clause under the head BOard of Directors that .... nos of directors shall be deputed with your consent or so...
atish singh
(Querist) 25 June 2008
as the share acquisition is in an indirect way , thus no question arises regarding the share purchase agreement . sebi takeover regl. 1998 applies to acquisition of shares ,where the acquirer has to make apublic annoncement. i just wanted to know the companies act compliance in this regard ??????
Manish Singh
(Expert) 26 June 2008
IS THAT mean you have gone for hostile takeover?
anyways, you have your answer in regulation 23 of the Substantial Acquisition......Regulations along with aricles of the target company.
Further go thoroughly thru the articles of the company regarding composition of board of dir..
and according to your voting rights as acquired, replace the directors with your representative one.
For further clearance, dont hesitate to write down.
atish singh
(Querist) 27 June 2008
ya it is a case of hostile takeover.regl 23 sets out the general obligations of the directoars of target company. it basically lays out the restrictions upon the board of directors.as written in your reply to replace the directors with the representative one,what is the process of that as per companies act ?
Manish Singh
(Expert) 30 June 2008
You must have acquired voting rights so just call a board meeting according to articles of the company and make changes accordingly.
articles of the target company plays very importnat part so go thoroughly through the same.
