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merger and amalgamation
why cannot transferee company hold shares shares in its own name or on behalf of trust upon merger?
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As per section 434 of the Companies Act, upon the scheme of compromise and arrangement, shares cannot be held by transfree company in its own name or in the name of the trust . Non compliance of the aforesaid provision will led to the cancellation of shares of trasnsfree Company as the merger would result into the combination of two entity into the single entity and the existing company will loose its existence.
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