The National Company Law Tribunal (NCLT) in Delhi recently allowed a Composite Scheme of Arrangement pertaining to Indian snacks and restaurant company Haldiram.
The scheme of arrangement sought demerger of the Quick Retail Restaurant (QRS) business of Haldiram Manufacturing Company Private Limited, Haldiram Ethnic Foods Private Limited, and Haldiram Marketing Private Limited with effect from April 1, 2023. It also sought the amalgamation of Haldiram Products Private Limited and HR Bakers Private Limited.
The paid-up capital of these companies ranged from Rs 10 lakh to Rs 10 crore.
Demerger is a process by which a business is split from a company to be made into a company of its own. Amalgamation is a process by which two or more companies are combined together with their assets and liabilities. Companies can choose to undertake such processes for a variety of reasons including consolidation of market and offsetting of liabilities among others.
The companies had also asked for the tribunal's consent to dispense with convening meetings of equity shareholders, secured creditors and unsecured creditors of the companies. The companies told NCLT that the board of directors of these six companies have approved the proposed schemes of arrangement.
Since all the companies under consideration are based out of Delhi, the applications were moved at the NCLT in Delhi.
According to the judgment, accessed by Moneycontrol, the companies had moved the NCLT under section 230 to 232 of the Companies Act, 2013. These sections empower the tribunals to allow schemes of arrangement and monitor its implementation.
The tribunal, on hearing the companies and perusing the records and documents, allowed the schemes of arrangement and furthermore exempted the companies from holding meetings of shareholders, secured creditors and unsecured creditors.
In November 2022, it was reported that Haldiram's is eyeing an initial public offering (IPO) in the next 18 months. According to the report, the Haldiram family is planning to merge their Delhi and Nagpur-based businesses to create a combined consolidated entity.
The potential Haldiram's IPO will be keenly watched, as both the Haldiram entities hold a cumulative share of 48.5 percent in the Indian ethnic snacks market, according to a recent survey conducted by Frost & Sullivan.
The combined revenue of both the Haldiram entities added up to Rs 9,000 crore in the fiscal year 2021-22.
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