Financial Daily from THE HINDU group of publications
Friday, Jan 25, 2002
Mergers & Acquisitions
HC okays ITC merger plan
Our Legal Correspondent
KOLKATA, Jan. 24
THE Calcutta High Court has approved the proposal of amalgamation of ITC Bhadrachalam Paperboards Ltd with ITC Ltd.
On December 7, 2001, a meeting of shareholders of ITC Ltd was held here to consider the proposal of amalgamation, when majority shareholders opined in the affirmative. The scheme is set to take effect from April 1, 2001.
Earlier, on October 12, 2001, the court ordered holding of the shareholders' meeting, appointing Mr Tapas Kumar Banerjee as the chairman of the meeting.
The Karur Vysya Bank, which advanced financial assistance to Bhadrachalam Finance & Investment Ltd, a subsidiary of ITC-BPL, opposed the approval of the scheme. One Mr Tamal Majumder, holder of six ITC shares, also opposed the proposal.
The court did not take notice of these objections. The Union Government has already given consent to the amalgamation proposal.
On the application filed by Mr Ravi Tandon, financial adviser of ITC, the court passed the order for holding the meetings.
It was stated that ITC promoted ITC-BPL in 1975, and in 1998, the company became its subsidiary. Amalgamation would enable better utilisation of various resources of both the companies, the applicant stated.
In the application, it was further stated that the amalgamation would benefit the shareholders in general, and the companies, in particular.
ITC's paperboards business, currently residing in ITC-BPL, will form part of the Paper and Packaging business group upon merger with the company.
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