RECONSTRUCTION
Transformation, Merger and Cessation
The transformation of a company is the operation whereby a company changes its legal form by decision of its partners. The transformation of the company does not result in the creation of a new corporate body. The act of transformation amounts to an amendment of the Articles of Association (PA) which is subject to the publication formalities seen above. Nevertheless, if the transformation of a company has the effect of increasing the commitment of a shareholder in which the shareholders liability is limited to their contributions into one in which their liability is unlimited the consent of the shareholder in question is required
Transformation does not destroy the rights of creditors of the company. Accordingly creditors shall maintain their rights over the company prior to such transformation In addition the creditors may within three months from the date of publication of the act of amendment petition the court to nullify the transformation if they fail to obtain sufficient guarantee from the company.
For its part a merger is the operation whereby two or more companies merge to form a single company either by creating a new company or by one company acquiring the other (s). All the companies involved in the merger operation are each required to take and publish the decision in accordance with the rules regulating amendment of import aspects affecting the company in default in accordance with the requirements for constituting a new company.
A merger entails the dissolution without liquidation of the disappearing company and the universal transfer to the beneficiary company of their assets and liabilities in the state in which they are on the date of wrapping up of the operation.
Note that third parties (creditors) shall maintain their rights over the company prior to the merger. Furthermore, they may request the court within three months from the date of publication of the act of merger to declare the merger void if the fail to receive adequate guarantee from the company.
In addition a company may either alone or together with other companies create a new company by the partial transfer of its assets to the new company. Note that the decision transferring part of the assets of the company is taken and published in accordance with the rules to be observed when amending important aspects of the company. In default the rules regulating the reduction of the capital of the company must be strictly followed.
AMALGAMATION, MERGERS AND TAKE-OVERS
The transformation of a company is the operation whereby a company changes its legal form by decision of its partners. The transformation of the company does not result in the creation of a new corporate body. The act of transformation amounts to an amendment of the Articles of Association (PA) which is subject to the publication formalities seen above. Nevertheless, if the transformation of a company has the effect of increasing the commitment of a shareholder in which the shareholders liability is limited to their contributions into one in which their liability is unlimited the consent of the shareholder in question is required.
For its part a merger is the operation whereby two or more companies merge to form a single company either by creating a new company or by one company acquiring the other (s). All the companies involved in the merger operation are each required to take and publish the decision in accordance with the rules regulating amendment of import aspects affecting the company in default in accordance with the requirements for constituting a new company.
A merger entails the dissolution without liquidation of the disappearing company and the universal transfer to the beneficiary company of their assets and liabilities in the state in which they are on the date of wrapping up of the operation.
Note that third parties (creditors) shall maintain their rights over the company prior to the merger. Furthermore, they may request the court of the act of merger to declare the merger void if the fail to receive adequate guarantee from the company.
. SCHEMES OF ARRANGEMENT
The transformation of a company is the operation whereby a company changes its legal form by decision of its partners. The transformation of the company does not result in the creation of a new corporate body. The act of transformation amounts to an amendment of the Articles of Association (PA) which is subject to the publication formalities seen above. Nevertheless, if the transformation of a company has the effect of increasing the commitment of a shareholder in which the shareholders liability is limited to their contributions into one in which their liability is unlimited the consent of the shareholder in question is required.
In addition a company may either alone or together with other companies create a new company by the partial transfer of its assets to the new company. Note that the decision transferring part of the assets of the company is taken and published in accordance with the rules to be observed when amending important aspects of the company. In default the rules regulating the reduction of the capital of the company must be strictly followed.
RIGHTS OF SHAREHOLDERS
The rights of shareholders are safeguarded through Article 142 which states that a major transaction of amalgamation can only be approved by a special resolution at a meeting of the shareholders.
A special resolution can only be approved by a majority of 75% of the votes of those shareholders entitled to vote and who have voted on the issue under consideration.
RIGHTS OF CREDITORS
Transformation does not destroy the rights of creditors of the company Accordingly creditors shall maintain their rights over the company prior to such transformation.
In addition the creditors may petition the court to nullify the transformation if they fail to obtain sufficient guarantee from the company.
