difference b/w demerger and amalgamation??

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Querist : Anonymous

Querist : Anonymous (Querist)

26 April 2011 please tell me the difference between demerger and amalgamation????????

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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26 April 2011 In amalgamation two or more companies joint together to form a new company but in demerger one company splits itself into two or more new companies to work separately.

Demerger' means transfer of a running business undertaking to another company under a Scheme of Arrangement under the Companies Act, 1956 by taking Sanction of the High Court. An essential feature is that the transferor company should not receive the consideration but the acquiring company should pay the consideration directly to the shareholders and that too apparently, only in the form of shares.

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RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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27 April 2011 THANKYOU AUTHOR FOR PUT UP UR QUERY IN CA CLUB INDIA..

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