Neha Gupta (PCS) 13 December 2014
One of my client company is having a wholly own subsidiary in India. The Indian company have non convertible preference shares in its capital, now they want to issue more preference shares of same kind to its foreign parent company.
Now question is should it needs to comply with provisions of private placement under section 42 of the companies Act, 2013. As because, I was reading rule 13 of chapter IV regarding "Issue of shares on preferential basis" (covered u/s 62) does not involve non convertible securities.
That means we have to call an EGM and issue offer letter and file pas4 and pas 5 along with pas 3.