SYED HASAN AZHAR RIZVI, J. - Through this petition under Sections 284 & 287 of the Companies Ordinance, 1984, the petitioners which are private companies with limited liability incorporated under the Companies Ordinance 1984 have sought permission of this Court for a Scheme of Arrangement dated 15.06.2010 between them as required under Section 284(2) of the Companies Ordinance, 1984 more particularly described in the Scheme as set forth in Annexure 'A' to the petition with the following prayers:-
(a) an order under Section 284(2) of the Companies Ordinance, 1984 sanctioning the Scheme of Arrangement as set forth in Annexure A hereto so as to make the Scheme binding on the petitioner No. 1. And its Members and on the Petitioner No. 2 and its Members;
(b) the following orders under Section 287 of the Companies Ordinance, 1984 so as to take effect at the same time as the order sanctioning the Scheme of Arrangement takes effect in accordance with the Section 254(3) of the Companies Ordinance, 1984, namely:
(i) an order under section 287(1 )(a) of the Companies Ordinance, 1984 transferring to and vesting in the Petitioner No, 1 the undertaking of the Petitioner No. 2 together with all its properties, assets, rights, liabilities and obligations of every description as more particularly described in paragraph 1 of the Scheme, all as subsisting immediately preceding the Completion date as defined in the Scheme.
(ii) an order under Section 287(1) of the Companies Ordinance, 1984 directing the Petitioner No. 1 to issue at par 485,169 ordinary shares of Rs. 10/- Each credited as fully paid up of the aggregate nominal value of Rs. 4,851,690 and to allot 485,169 shares to the Qualifying shareholders (as defined in the Scheme) as at the Record date . (as defined in the Scheme) in proportion to the respective shareholders in the petitioner No. 2, such that in respect of every 5.15 Existing Shares (as defined in the Scheme) held by each Qualifying Shareholder there shall be allotted 1 share of Rs. 10/- each credited as fully paid up by the petitioner No. 1 and directing that the determination of the Qualifying Shareholders and their respective entitlements to the shares in the petitioner No. 1, the treatment of fractional entitlements and allotment of such shares and delivery of share certificate by the petitioner No. 1 shall be in accordance with Article XVI of the Scheme.
(iii) For the purposes of the orders of clauses (ii), (iii) (iv) and order under Section 287(1 )(f) of the Companies Ordinance, 1984 directing that the Registrar of Members of the petitioner No. 1 shall be closed for a period of 7 days prior to issue of shares on the Record Date (as defined in the Scheme) for determining the identities and entitlements of the Qualifying Shareholders (as defined in the Scheme), and that notice of such closure shall be published not less than 7 days prior to the date of such closure in at least one issue each of a daily newspaper in the English language and a daily newspaper in the Urdu language having circulation in the Province of Sindh;
(iv) an order under Section 287(1 )(f) of the Companies Ordinance, 1984 directing that the share certificates issued by the petitioner No. 1 as at the Record Date (as defined in the Scheme) in respect of the Existing Shares' (as defined in the Scheme) shall stand cancelled.
(v) an order under Section 287(1 )(f) of the Companies Ordinance, 1984 directing that in the case of book entry securities (as defined in the Central Depositaries Act, 1997) and for the purposes of that Act and of the Central Depository Company of Pakistan Limited regulations, the orders of clauses (ii), (iii), (iv), (v), (vi) and (vii), shall be effected by book entry in the central depository register and by cancellation and substitution of jumbo certificates if any, issued to the Central Depository Company of Pakistan Limited.
(vi) an order under Section 287(1 )(c) of the Companies Ordinance, 1984 directing that all legal proceedings instituted by or against the petitioner No. 2 which may be pending shall be continued by or against the petitioner No. 1.
(vii) such further or other order or orders as may seem just and proper to this Hon'ble Court."
2. The object of this petition is to obtain the sanction of this Court to a Scheme of Arrangement between Petitioner No. 1 (Liberty Mills Ltd.) and its members and Petitioner No. 2 (Liberty Energy) and its members facilitating orders under Section 287 of the Companies Ordinance in connection with the merger of the petitioner No. 2 with and into petitioner No. 1 and in accordance with that Scheme under which the undertakings and business and all assets, rights, liabilities and obligations pertaining thereto as described in the Scheme of arrangement shall vest in the petitioner No. 1 consequent upon issuance of paid up share capital of the petitioner No. 1 to the members of the petitioner No. 2.
3. Pursuant to order passed on CMA No. 1094/2010 notice of this petition to consider scheme of arrangement proposed between the petitioners as required under Rule 953 of S.C.C. Rules (O.S.) was affixed on the Court Notice Board. Notice was also issued to the Registrar, Joint Stock Companies. Publication was effected in 'daily Jang' and daily 'News' dated 30.08.2010 and so also in the official Gazette of Pakistan dated 08.09.2010.
4. Separate meetings of the members of Petitioners were held to consider the proposed arrangement Annexure "A" to the petition, the requisite quorum as directed by this Court being present, the Scheme of Arrangement, of which a copy had been circulated alongwith the statement of information under Section 286 of the Companies Ordinance, 1984 was considered and resolution was passed by the majority required under Section 284(2) of the Companies Ordinance, 1984 for approval of the Scheme.
5. Notices of the extra-ordinary general meetings of both the petitioners were published in daily 'Khabrain' and daily 'Business Recorder' dated 11.12.2010 and 14.12.2010.
6. On 28.10.2010 a statement has been filed by the Joint Registrar of Companies with the prayer that the petitioners be directed to submit the requisite information before the SECP in order to enable the SECP to file its representation before this Court and the same is to be taken into account by this Court before passing any order. Today, Syed Imran Shamsi, Law Officer has filed parawise comments on behalf of Securities and Exchange Commission of Pakistan, wherein it is stated that SECP has no objection in respect of proposed Scheme of Arrangement and merger of Petitioners companies.
7. I have perused the proposed Scheme of Arrangement for merger. Members of the Petitioners Companies have unanimously approved the resolution of the merger of the Petitioner No. 1 into Petitioner No. 2. Neither the employees of Petitioners Companies nor of the creditors have come forward to oppose the scheme. Today, Syed Imran Shamsi, Law Officer of SECP is present in Court and has recorded his no objection for merger of the petitioners companies.
8. There is no material on record to suggest that the merger would be against public interest or in violation of any law. The petition is, therefore, allowed as prayed and amalgamation Scheme of Arrangement (Annexure "A" to the Petition) is sanctioned. Consequently, Petitioner No. 2 (Liberty Energy (Pvt.) Limited) stand merged/amalgamated with and Petitioner No, 1 (Liberty Mills Limited) as on the date. On which the copy of the order of the Court sanctioning the scheme is filed with the Registrar of Companies at Karachi in terms of Article of the Scheme.
The petition stands disposed of in this foregoing terms.