Ubico Networks Private Limited v. Citycom Networks Private Limited

1. This joint application has been filed under Sections 390 & 391 of the Companies Act, 1956 read with Rules 6 & 9 of the Companies (Court) Rules, 1959 by the applicant companies seeking directions of this court to dispense with the requirement of convening the meetings of the equity shareholders of the transferor and transferee companies, debenture holder of the transferee company and the secured creditors of the transferor company no. 2 and the transferee company and for convening of separate meetings of the secured and unsecured creditors 2015:DHC:5862 of the transferor company no. 1 and the unsecured creditors of the transferor company no. 2 and the transferee company to consider and approve, with or without modification, the proposed Scheme of Amalgamation of Ubico Networks Private Limited (hereinafter referred to as the transferor company no. 1) and Spectranet IT Services Private Limited (hereinafter referred to as the transferor company no. 2) with Citycom Networks Private Limited (hereinafter referred to as the transferee company).

2. The registered offices of the transferor and transferee companies are situated at New Delhi, within the jurisdiction of this Court.

3. The transferor company no. 1 was incorporated under the Companies Act, 1956 on 18th May, 2007 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.

4. The transferor company no. 2 was incorporated under the Companies Act, 1956 on 25th July, 2012 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.

5. The transferee company was originally incorporated under the Companies Act, 1956 on 9th May, 2008 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi under the name and style of Citicom Networks Private Limited. The company changed its name to Citycom Networks Private Limited and obtained the fresh certificate of incorporation on 25th July, 2008.

6. The present authorized share capital of the transferor company no.1 is Rs.20,00,00,000/- divided into 2,00,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.18,32,80,000/- divided into 1,83,28,000 equity shares of Rs.10/- each.

7. The present authorized share capital of the transferor company no.2 is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each.

8. The present authorized share capital of the transferee company is Rs.30,00,00,000/- divided into 3,00,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.23,95,20,000/- divided into 2,39,52,000 equity shares of Rs.10/- each.

9. Copies of the Memorandum and Articles of Association of the transferor and transferee companies have been filed on record. The audited balance sheets, as on 31st March, 2014, along with the reports of the auditors, and the provisional balance sheets, as on 15th March, 2015, of the transferor and transferee companies have also been filed.

10. A copy of the Scheme of Amalgamation has been placed on record and the salient features of the Scheme have been incorporated and detailed in the application and the accompanying affidavit. It is submitted by the applicants that the Scheme has been envisaged to create a single robust entity which would carry on businesses that are integrated and complementary in nature. It is claimed that the proposed amalgamation would result in strengthened leadership in the industry in terms of asset base, revenue, and market share of the combined entity. It is further claimed that the amalgamation would help the management to achieve greater integration and better financial strength which would result in improving the competitive position of the combined entity

11. So far as the share exchange ratio is concerned, the Scheme provides that, upon coming into effect of this Scheme, the transferee company shall issue and allot equity shares to the shareholders of the transferor companies in the following ratio: “27 equity shares of Rs.10/- each of the transferee company, credited as fully paid up, for every 100 equity shares of Rs.10/- each fully paid up held in transferor company no. 1.” “151 equity shares of Rs.10/- each of the transferee company, credited as fully paid up, for every 01 equity share of Rs.10/each fully paid up held in transferor company no. 2.”

12. It has been submitted by the applicants that no proceedings under Sections 235 to 251 of the Companies Act, 1956 are pending against the applicant companies.

13. The Board of Directors of the transferor and transferee companies in their separate meetings held on 19th March, 2015 have unanimously approved the proposed Scheme of Amalgamation. Copies of the Resolutions passed at the meetings of the Board of Directors of the transferor and transferee companies have been placed on record.

14. The transferor company no. 1 has 03 equity shareholders. All the equity shareholders have given their consents/no objections in writing to the proposed Scheme of Amalgamation. Their consents/no objections have been placed on record. They have been examined and found in order. In view thereof, the requirement of convening the meeting of the equity shareholders of the transferor company no. 1 to consider and, if thought fit, approve, with or without modification, the proposed Scheme of Amalgamation is dispensed with.

15. The transferor company no. 2 has 02 equity shareholders. Both the equity shares have given their consents/no objections in writing to the proposed Scheme of Amalgamation. Their consents/no objections have been placed on record. They have been examined and found in order. In view thereof, the requirement of convening the meeting of the equity shareholders of the transferor company no. 2 to consider and, if thought fit, approve, with or without modification, the proposed Scheme of Amalgamation is dispensed with. There is no secured creditor of the transferor company no. 2, as on 15th March, 2015.