Question relating to buying a private limited company
A private limited company ("A") incorporated in India intends to purchase 100% of another another private limited company ("B")incorporated in India by way of either a slump sale agreement or by the sale of entire share capital of B to A whereby B will transfer entire business to A.
1. What is the difference between the two types of purchase ?
2. Which one is a better option to enter into ?
3. If i buy 100 % of entire share capital of B will it become a wholly owned subsidary ? (cause of 100% ownership)
3. What happens to the shares and shareholders in both the above cases.
4.Which provisions of the companies Act governs the above 2 cases.
Would it amount to an acquisition ? merger ? takeover ? amalgamation ?
CAclubindia
