Diff b/w merger and amalgamation ?

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 April 2012 hello experts pls tell what is the main difference between mergers and amalgamations in context of companies act, 1956 ?

whether both are same or what ? pls tell me in context of corporate restructuring ?

Pankaj Gandhi Jaiswal

Pankaj Gandhi Jaiswal (Expert)
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04 April 2012 In merger one company is merged in another company while in Amalgamation two company are amalgamating in new company

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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07 April 2012 The combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock.

"A consolidation is the union of two or more corporations into one corporate body, after which the constituent corporations cease to exist.

"A merger is the absorption of one corporation into another....

"[A]malgamation is ... used to designate a consolidation or merger."

For example, Ontario's Business Corporations Act, at section 174, provides that "2 or more corporations ... may amalgamate and continue as one corporation" (RSO 1990 Chapter B16).

Amalgamation is also used in the sense of amalgamating of two or more municipalities to effect cost-savings in the provision of otherwise duplicative municipal services. In this context, Ian MacFee Rogers wrote:

"An amalgamation has been defined as a fusion of two or more legal entities into a continued new union with the obligations, by-laws and assets of the former municipalities."