Industry-wise break-up of the Schemes filed during the previous year April 2014 to March 2015.

Industry TOTAL TOTAL
No. of Deals from
April 2014 to March 2015
No. of Deals from
April 2013 to March 2014
Chemicals 2 4
Engineering 11 23
Entertainment 2 10
Financial Services 24 21
Investments 31 24
Information Technology 22 24
Pharmaceutical 13 7
Steel, Power & Cement 8 9
Real Estate 46 30
Telecommunication 7 8
Textile 13 0
Jewellery 6 0
Others 119 83
Total 304 243

During the previous year April 2014 to March 2015, 304 (Three Hundred and Four) Schemes were filed, involving 888 (Eight hundred and Eighty Eight) Companies, of which 248 (Two Hundred and Forty Eight) Schemes were Scheme of Amalgamation, 39 (Thirty Nine) Schemes were Scheme of Demerger, 5 (Five) Schemes were Scheme of Arrangement and 12 (Twelve) Schemes were Composite Scheme of  Arrangement.

M&A-Happenings-March 2015

The diagram shows that the Real Estate sector had the maximum numbers of deals cracked during the last one year with 46 deals in total, followed by Investment sector with 31 deals and Financial Services sector with 24 deals.  ‘Others’ includes various sectors like Infrastructure,
Jewellery, Media and Auto Components to name a few.

Some other important details regarding Schemes filed during the previous year April 2014 to March 2015.

No. of Listed Companies who have filled the scheme 40
No. of companies having paid up capital of more than Rs. 10 crore 156
No. of mergers schemes between holding and subsidiary companies 125
No. of schemes in which Transferor Company has carried forward losses and the Transferee Company is profit making 59
No. of schemes in which Transferor Company was profit making and the Transferee Company has carried forward losses 42
No. of schemes in which  Transferor Company and the Transferee Company both have carried forward losses 72

 

Analysis:

  • There were 125 schemes between holding and subsidiary companies, i.e. these companies have gone in for internal restructuring. There has been trend of merger between holding and subsidiary company to gain from synergy of resources.
  • There were 59 schemes in which Transferor Company had carried forward losses and the Transferee Company was  profit making, thus  the Transferee Company was able to acquire those companies at low prices while the Transferor Companies were able to exit business by gaining fair value for their loss making business.
  • There were 42 schemes in which Transferor Company was profit making and the Transferee Company had carried forward losses, which were reverse mergers. Thus the Transferee Companies were able to seek relief under section 72A of Income tax Act.
  • There were 72 schemes in which Transferor Company and the Transferee Company both had carried forward losses, thus the companies were mainly aiming at joint revival of the both transferor and transferee companies through the said schemes.
print