Mergers
Companies Act
Interpretation (Chapter 3)
461. (1) In this Chapter—
“director”, in relation to a company which is being wound up, means liquidator;
“merger” means—
(a) a merger by acquisition,
(b) a merger by absorption, or
(c) a merger by formation of a new company,
within, in each case, the meaning of section 463 ;
“merging company” means—
(a) in relation to a merger by acquisition or a merger by absorption, a company that is, in relation to that merger, a transferor company or the successor company, and
(b) in relation to a merger by formation of a new company, a company that is, in relation to that merger, a transferor company;
“share exchange ratio” means the number of shares or other securities in any successor company that the common draft terms of merger provide to be allotted to members of any transferor company for a given number of their shares or other securities in the transferor company;
“successor company”, in relation to a merger, means the company to which assets and liabilities are to be, or have been, transferred from the transferor company or companies, by way of that merger;
“transferor company”, in relation to a merger, means a company, the assets and liabilities of which are to be, or have been, transferred to the successor company by way of that merger.
(2) References in this Chapter to the acquisition of a company are references to the acquisition of the assets and liabilities of the company by way of a merger under this Chapter.
Requirements for Chapter to apply
462. This Chapter applies only if—
(a) none of the merging companies is a public limited company, and
(b) one, at least, of the merging companies is a private company limited by shares.
Mergers to which Chapter applies — definitions and supplementary provision
463. (1) In this Chapter “merger by acquisition” means an operation in which a company acquires all the assets and liabilities of one or more other companies that is or are dissolved without going into liquidation in exchange for the issue to the members of that company or those companies of shares in the first-mentioned company, with or without any cash payment.
(2) In this Chapter “merger by absorption” means an operation whereby, on being dissolved and without going into liquidation, a company transfers all of its assets and liabilities to a company that is the holder of all the shares representing the capital of the first-mentioned company.
(3) In this Chapter “merger by formation of a new company” means an operation in which one or more companies, on being dissolved without going into liquidation, transfers all its or their assets and liabilities to a company that it or they form — the “other company”— in exchange for the issue to its or their members of shares representing the capital of the other company, with or without any cash payment.
(4) Where a company is being wound up it may become a party to a merger by acquisition, a merger by absorption or a merger by formation of a new company, provided that the distribution of its assets to its shareholders has not begun at the date, under section 466 (5), of the common draft terms of merger.
Merger may not be put into effect save in accordance with the relevant provisions of this Act
464. (1) A merger may not be put into effect save under and in accordance with—
(a) the Summary Approval Procedure and the appropriate provisions of this Chapter where such procedure is employed, or
(b) in the absence of the Summary Approval Procedure being employed for that purpose, the relevant provisions of this Chapter,
but this is without prejudice to the alternative of proceeding under Chapter 1 to achieve the same or a similar result to that which can be achieved by such an operation.
(2) The reference in subsection (3) to a merger taking effect under this Chapter or in section 465 to proceeding under this Chapter includes a reference to a case in which the Summary Approval Procedure and the appropriate provisions of this Chapter are employed for that purpose.
(3) A merger shall not take effect under this Chapter (or any operation to the same or similar effect under Chapter 1) in the absence of the approval, authorisation or other consent, if any, that is required by any other enactment or a Community act for the merger to take effect.
Chapters 1 and 3: mutually exclusive modes of proceeding to achieve merger
465. All the elements of the operation constituting a merger shall be effected by proceeding either under this Chapter or under Chapter 1 and not by proceeding partly, as regards some of its elements, under one of those Chapters and partly, as regards other of its elements, under the other of those Chapters.
Common draft terms of merger
466. (1) Where a merger is proposed to be entered into, the directors of the merging companies shall draw up common draft terms of merger and approve those terms in writing.
(2) The common draft terms of merger shall state, at least:
(a) in relation to each of the transferor companies—
(i) its name,
(ii) its registered office, and
(iii) its registered number;
(b) in relation to the successor company—
(i) where the successor company is an existing company, the particulars specified in subparagraphs (i) to (iii) of paragraph (a), or
(ii) where the successor company is a new company yet to be formed, what are proposed as the particulars specified in subparagraphs (i) and (ii) of that paragraph;
(c) except in the case of a merger by absorption—
(i) the proposed share exchange ratio and amount of any cash payment,
(ii) the proposed terms relating to allotment of shares or other securities in the successor company, and
(iii) the date from which the holding of shares or other securities in the successor company will entitle the holders to participate in profits and any special conditions affecting that entitlement;
(d) the date from which the transactions of the transferor company or companies are to be treated for accounting purposes as being those of the successor company;
(e) the rights, if any, to be conferred by the successor company on members of the transferor company or companies enjoying special rights or on holders of securities other than shares representing a transferor company’s capital, and the measures proposed concerning them;
(f) any special advantages granted to—
(i) any director of a merging company, or
(ii) any person appointed under section 468 ;
(g) the successor company’s constitution;
(h) information on the evaluation of the assets and liabilities to be transferred to the successor company; and
(i) the dates of the financial statements of every merging company which were used for the purpose of preparing the common draft terms of merger.
(3) The common draft terms of merger may include such additional terms as are not inconsistent with this Chapter.
(4) The common draft terms of merger shall not provide for any shares in the successor company to be exchanged for shares in a transferor company held either—
(a) by the successor company itself or its nominee on its behalf, or
(b) by the transferor company itself or its nominee on its behalf.
(5) The date of the common draft terms of merger shall, for the purposes of this Chapter, be the date when the common draft terms of merger are approved in writing under subsection (1) by the boards of directors of the merging companies; where the dates on which those terms are so approved by each of the boards of directors are not the same, then, for the foregoing purposes, the date shall be the latest date on which those terms are so approved by a board of directors.
Directors’ explanatory report
467. (1) Except in the case of a merger by absorption and subject to subsection (4), a separate written report (the “explanatory report”) shall be prepared in respect of each of the merging companies by the directors of each such company.
(2) The explanatory report shall at least give particulars of, and explain—
(a) the common draft terms of merger, and
(b) the legal and economic grounds for and implications of the common draft terms of merger with particular reference to the proposed share exchange ratio, organisation and management structures, recent and future commercial activities and the financial interests of the holders of the shares and other securities in the company.
(3) On the explanatory report being prepared in relation to a company, the board of directors of it shall approve the report in writing.
(4) This section shall not apply if the following condition is, or (as appropriate) the following 2 conditions are, satisfied:
(a) other than in a case falling within paragraph (b), all of the holders of shares conferring the right to vote at general meetings of each of the merging companies have agreed that this section shall not apply; or
(b) where a requirement for the taking effect of a vote (whether a vote generally or of the type to which this subsection applies) by holders of shares of any of the merging companies is that a holder of securities of the company has consented thereto—
(i) the agreement mentioned in paragraph (a) exists, and
(ii) all of the holders of securities of the company or companies in respect of which the requirement mentioned in this paragraph operates have agreed that this section shall not apply.
Expert’s report
468. (1) Subject to subsection (2), there shall, in accordance with this section, be appointed one or more persons to—
(a) examine the common draft terms of merger, and
(b) make a report on those terms to the shareholders of the merging companies.
(2) Subsection (1) shall not apply where—
(a) the merger is a merger by absorption,
(b) the merger is a merger in which the successor company (not being a company formed for the purposes of the merger) holds 90 per cent or more (but not all) of the shares carrying the right to vote at a general meeting of the transferor company or at general meetings of each of the transferor companies, or
(c) every member of every merging company agrees that such report is not necessary.
(3) The functions referred to in subsection (1)(a) and (b) shall be performed either—
(a) in relation to each merging company, by one or more persons appointed for that purpose in relation to the particular company by its directors (and the directors of each company may appoint the same person or persons for that purpose), or
(b) in relation to all the merging companies, by one or more persons appointed for that purpose by the court, on the application to it of all of the merging companies.
(4) The person so appointed, or each person so appointed, is referred to in this Chapter as an “expert” and a reference in this Chapter to a report of an expert or other action (including an opinion) of an expert shall, in a case where there are 2 or more experts, be read as reference to a joint report or joint other action (including an opinion) of or by them.
(5) A person shall not be appointed an expert unless the person is a qualified person.
(6) A person is a qualified person for the purposes of this section if the person—
(a) is a statutory auditor, and
(b) is not—
(i) a person who is or, within the period of 12 months before the date of the common draft terms of merger has been, an officer or employee of any of the merging companies,
(ii) except with the leave of the court, a parent, spouse, civil partner, brother, sister or child of an officer of any of the merging companies (and a reference in this subparagraph to a child of an officer shall be deemed to include a child of the officer’s civil partner who is ordinarily resident with the officer and the civil partner), or
(iii) a person who is a partner, or in the employment, of an officer or employee of any of the merging companies.
(7) The report of the expert shall be made available not less than 30 days before the date of the passing of the resolution referred to in section 202 (1)(a)(ii) or 473 , as the case may be, by each of the merging companies, shall be in writing and shall—
(a) state the method or methods used to arrive at the proposed share exchange ratio,
(b) give the opinion of the expert as to whether the proposed share exchange ratio is fair and reasonable,
(c) give the opinion of the expert as to the adequacy of the method or methods used in the case in question,
(d) indicate the values arrived at using each such method,
(e) give the opinion of the expert as to the relative importance attributed to such methods in arriving at the values decided on, and
(f) specify any special valuation difficulties which have arisen.
(8) The expert may—
(a) require each of the merging companies and their officers to give to the expert such information and explanations (whether oral or in writing), and
(b) make such enquiries,
as the expert thinks necessary for the purposes of making the report.
(9) If a merging company fails to give to the expert any information or explanation in the power, possession or procurement of that company, on a requirement being made of it under subsection (8)(a) by the expert, that company and any officer of it who is in default shall be guilty of a category 2 offence.
(10) If a merging company makes a statement (whether orally or in writing), or provides a document, to the expert that conveys or purports to convey any information or explanation the subject of a requirement made of it under subsection (8)(a) by the expert and—
(a) that information is false or misleading in a material particular, and
(b) the company knows it to be so false or misleading or is reckless as to whether it is so false or misleading,
the company and any officer of it who is in default shall be guilty of a category 2 offence.
(11) If a person appointed an expert under subsection (3)(a) or (b) ceases to be a qualified person, that person—
(a) shall immediately cease to hold office, and
(b) shall give notice in writing of the fact of the person’s ceasing to be a qualified person to each merging company and (in the case of an appointment under subsection (3)(b)) to the court within 14 days after the date of that cessation,
but without prejudice to the validity of any acts done by the person under this Chapter before that cessation.
(12) A person who purports to perform the functions of an expert (in respect of the merger concerned) under this Chapter after ceasing to be a qualified person (in respect of that merger) shall be guilty of a category 2 offence.
Merger financial statement
469. (1) Where—
(a) the latest statutory financial statements of any of the merging companies relate to a financial year ended more than 6 months before the date of the common draft terms of merger, and
(b) the Summary Approval Procedure is not being employed to effect the merger,
then, subject to subsection (6), if that company is availing itself of the exemption from the requirement to hold a general meeting provided by section 473 (6), that company shall prepare a merger financial statement in accordance with the provisions of this section.
(2) The merger financial statement shall be drawn up—
(a) in the format of the last annual balance sheet, if any, of the company and in accordance with the provisions of Part 6 , and
(b) as at a date not earlier than the first day of the third month preceding the date of the common draft terms of merger.
(3) Valuations shown in the last annual balance sheet, if any, shall, subject to the exceptions provided for under subsection (4), only be altered to reflect entries in the accounting records of the company.
(4) Notwithstanding subsection (3), the following shall be taken into account in preparing the merger financial statement—
(a) interim depreciation and provisions, and
(b) material changes in actual value not shown in the accounting records.
(5) The provisions of Part 6 relating to the statutory auditor’s report on the last statutory financial statements of the company concerned shall apply, with any necessary modifications, to the merger financial statement required of the company by subsection (1).
(6) This section shall not apply to a merging company if the following condition is, or (as appropriate) the following 2 conditions are, satisfied:
(a) other than in a case falling within paragraph (b), all of the holders of shares conferring the right to vote at general meetings of the company have agreed that this section shall not apply; or
(b) where a requirement for the taking effect of a vote (whether a vote generally or of the type to which this subsection applies) by holders of shares of the company is that a holder of securities of the company has consented thereto—
(i) the agreement mentioned in paragraph (a) exists, and
(ii) all of the holders of securities in respect of which the requirement mentioned in this paragraph operates have agreed that this section shall not apply.
Registration and publication of documents
470. (1) Subject to subsections (4)(a) and (5), each of the merging companies shall deliver to the Registrar—
(a) a copy of the common draft terms of merger as approved in writing by the boards of directors of the companies, and
(b) a notice, in the prescribed form, specifying—
(i) its name,
(ii) its registered office,
(iii) its legal form, and
(iv) its registered number.
(2) Notice of delivery of the common draft terms of merger to the Registrar shall be published—
(a) by the Registrar, in the CRO Gazette, and
(b) by each merging company, in one national daily newspaper.
(3) The notice published in accordance with subsection (2) shall include:
(a) the date of delivery of the documentation under subsection (1);
(b) the matters specified in subsection (1)(b);
(c) a statement that copies of the common draft terms of merger, the directors’ explanatory report, the statutory financial statements referred to in section 471 (1) and the expert’s report (where relevant) are available for inspection by the respective members of each merging company at each company’s registered office; and
(d) a statement that a copy of the common draft terms of merger can be obtained from the Registrar.
(4) With regard to subsections (1) and (2)—
(a) compliance with those subsections is not required in a case where the Summary Approval Procedure is employed to effect the merger, and
(b) subject to that, those subsections shall be complied with by each of the merging companies at least 30 days before the date of the passing of the resolution on the common draft terms of merger by each such company in accordance with section 473 .
(5) This section shall not apply in relation to a merging company if the company—
(a) publishes, free of charge on its website for a continuous period of at least 2 months, commencing at least 30 days before the date of the general meeting which, by virtue of section 473 , is to consider the common draft terms of merger and ending at least 30 days after that date, a copy of the common draft terms of merger, approved pursuant to section 466 (1), and
(b) causes to be published in the CRO Gazette and once at least in 1 daily newspaper circulating in the district in which the registered office or principal place of business of the company is situate notice of publication on its website of the common draft terms of merger.
(6) Where, in the period referred to in subsection (5)(a), access to the company’s website is disrupted for a continuous period of at least 24 hours or for separate periods totalling not less than 72 hours, the period referred to in subsection (5)(a) shall be extended for a period corresponding to the period or periods of disruption.
Inspection of documents
471. (1) Subject to subsection (5), each of the merging companies shall, in accordance with subsection (3), make available for inspection free of charge by any member of the company at its registered office during business hours:
(a) the common draft terms of merger;
(b) subject to subsection (2), the statutory financial statements for the preceding 3 financial years of each company (audited, where required by that Part, in accordance with Part 6 );
(c) except in the case of a merger by absorption or in any other case where such a report is not required to be prepared by that section, the explanatory report relating to each of the merging companies referred to in section 467 ;
(d) if such a report is required to be prepared by that section, the expert’s report relating to each of the merging companies referred to in section 468 ; and
(e) each merger financial statement, if any, in relation to one or, as the case may be, more than one of the merging companies, required to be prepared by section 469 .
(2) For the purposes of paragraph (b) of subsection (1)—
(a) if any of the merging companies has traded for less than 3 financial years before the date of the common draft terms of merger, then, as respects that company, that paragraph is satisfied by the statutory financial statements for those financial years for which the company has traded (audited, where required by that Part, in accordance with Part 6 ) being made available as mentioned in that subsection by each of the merging companies, or
(b) if, by reason of its recent incorporation, the obligation of any of the foregoing companies to prepare its first financial statements under Part 6 had not arisen as of the date of the common draft terms of merger, then the reference in that paragraph to the financial statements of that company shall be disregarded.
(3) The provisions of subsection (1) shall apply in the case of each of the merging companies for a period of 30 days before the date of the passing of—
(a) where the Summary Approval Procedure is employed to effect the merger, the resolution referred to in section 202 (1)(a)(ii) by each such company, and
(b) where that procedure is not employed for that purpose, the resolution on the common draft terms of merger by each such company in accordance with section 473 .
(4) Section 127 (1) (access to documents during business hours) shall apply in relation to subsection (1) as it applies in relation to the relevant provisions of Part 4 .
(5) Subsection (1) shall not apply in relation to a merging company if it publishes free of charge on its website the documents specified in that subsection for a continuous period of at least 2 months, commencing at least 30 days before—
(a) where the Summary Approval Procedure is employed to effect the merger, the date of the resolution referred to in section 202 (1)(a)(ii) of the company, and
(b) where that procedure is not employed for that purpose, the date of the general meeting of the company which, by virtue of section 473 , is to consider the common draft terms of merger,
and ending at least 30 days after that date.
(6) Where, in the period referred to in subsection (5), access to the company’s website is disrupted for a continuous period of at least 24 hours or for separate periods totalling not less than 72 hours, the period referred to in subsection (5) shall be extended for a period corresponding to the period or periods of disruption.
(7) A reference in this section to statutory financial statements shall be deemed to include a reference to a directors’ report and a reference to auditing shall, in the case of such a report, be read as a reference to the operation referred to in section 336 (5).
Non-application of subsequent provisions where Summary Approval Procedure employed
472. (1) Without prejudice to subsections (2) and (3), the subsequent sections of this Chapter apply unless the Summary Approval Procedure is employed by the merging companies to effect the merger.
(2) Where the Summary Approval Procedure is employed for that purpose then, as provided for in Chapter 7 of Part 4 , on the passing of the resolution referred to in section 202 (1)(a)(ii) by each of the merging companies, the merger shall, in accordance with the common draft terms of merger and any supplemental document, take effect on the date specified in those terms or in that supplemental document and section 480 (3) shall apply as regards the effects of that merger with any necessary modifications.
(3) Notwithstanding that the Summary Approval Procedure is employed by the merging companies to effect the merger, then, in addition to the application of section 480 (3) by virtue of subsection (2)—
(a) section 479 (preservation of rights of holders of securities),
(b) section 483 (civil liability of directors and experts), and
(c) section 484 (criminal liability for untrue statements in merger documents),
shall apply where that procedure is employed.
(4) In this section “supplemental document” means the document referred to in section 209 (1).
General meetings of merging companies
473. (1) In this section a reference to a general meeting, without qualification, is a reference to a general meeting referred to in subsection (2).
(2) Subject to subsection (6), the subsequent steps under this Chapter in relation to the merger shall not be taken unless the common draft terms of merger have been approved by a special resolution passed at a general meeting of each of the merging companies, being a meeting held not earlier than 30 days after the date of the publication by the company of the notice referred to in section 470 (2)(b) or, as the case may be, the notice in the daily newspapers referred to in section 470 (5)(b).
(3) Subject to section 474 (2), the notice convening that meeting shall contain a statement of every shareholder’s entitlement to obtain on request, free of charge, full or, if so desired, partial copies of the documents referred to in section 471 (1) (and, accordingly, every shareholder has, subject to the foregoing provision, that entitlement).
(4) The directors of each transferor company shall inform—
(a) the general meeting of that company, and
(b) as soon as practicable, the directors of the successor company,
of any material change in the assets and liabilities of that transfer or company between the date of the common draft terms of merger and the date of that general meeting.
(5) The directors of the successor company shall inform the general meeting of that company of all changes of which they have been informed pursuant to subsection (4).
(6) Approval, by means of a special resolution, of the common draft terms of merger is not required—
(a) in the case of any transferor company in a merger by absorption, or
(b) in the case of the successor company in a merger by acquisition, if the conditions specified in subsection (7) have been satisfied.
(7) The conditions referred to in subsection (6)(b) are the following:
(a) the notice required to be published under section 470 (2)(b) was published in accordance with section 470 (2)(b) in respect of the successor company before the commencement of the period (in this subsection referred to as the “notice period”) of 30 days before the date of the passing by the transferor company of the resolution referred to in this section (or, where there is more than one transferor company and the dates on which each of them has passed such a resolution are not the same, the earliest date on which such a resolution was passed by one of them);
(b) the members of the successor company were entitled, during the notice period—
(i) to inspect, at the registered office of the successor company, during ordinary hours of business, copies of the documents referred to in section 471 (1), and
(ii) to obtain copies of those documents or any part of them on request;
(c) the right, conferred by subsection (8), to requisition a general meeting has not been exercised during the notice period.
(8) One or more members of the successor company who hold or together hold not less than 5 per cent of the paid-up capital of the company which carries the right to vote at general meetings of the company (excluding any shares held as treasury shares) may require the convening of a general meeting of the company to consider the common draft terms of merger, and section 178 (3) to (7) apply, with any necessary modifications, in relation to the requisition.
Electronic means of making certain information available for purposes of section 473
474. (1) For the purposes of section 473 , but subject to subsection (2), where a shareholder has consented to the use by the company of electronic means for conveying information, the copies of the documents referred to in section 471 (1) may be provided, by electronic mail, to that shareholder by the company and the notice convening the general meeting referred to in section 473 (2) shall contain a statement to that effect.
(2) The entitlement referred to in section 473 (3) shall not apply where, for the period specified in subsection (3), copies of the documents referred to in section 471 (1) are available to download and print, free of charge, from the company’s website by shareholders of the company.
(3) The period referred to in subsection (2) is a continuous period of at least 2 months, commencing at least 30 days before the date of the general meeting which, by virtue of section 473 , is to consider the common draft terms of merger and ending at least 30 days after that date.
Meetings of classes of shareholders
475. (1) Where the share capital of any of the merging companies is divided into shares of different classes the provisions referred to in subsection (2), with the exclusions specified in subsection (3), shall apply with respect to the variation of the rights attached to any such class that is entailed by the merger.
(2) Those provisions are the provisions of Chapter 4 of Part 3 on the variation of the rights attached to any class of shares in a company.
(3) There is excluded the following from the foregoing provisions: sections 88 (9) and 89.
Purchase of minority shares
476. (1) Where the special resolution referred to in section 473 has been passed by each of the merging companies (or such of them as are required by that section to pass such a resolution), a minority shareholder in a transferor company may, not later than 15 days after the relevant date, request the successor company in writing to acquire his or her shares in the transferor company for cash.
(2) Where a request is made by a minority shareholder in accordance with subsection (1), the successor company shall purchase the shares of the minority shareholder at a price determined in accordance with the share exchange ratio set out in the common draft terms of merger and the shares so purchased by the successor company shall be treated as treasury shares within the meaning of section 106 .
(3) Nothing in this section limits the power of the court to make any order necessary for the protection of the interests of a dissenting minority in a merging company.
(4) In this Chapter—
“minority shareholder”, in relation to a transferor company, means—
(a) in a case where the successor company (not being a company formed for the purpose of the merger) holds 90 per cent or more (but not all) of the shares carrying the right to vote at general meetings of the transferor company, any other shareholder in the company, or
(b) in any other case, a shareholder in the company who voted against the special resolution;
“relevant date” means—
(a) in relation to a minority shareholder referred to in paragraph (a) of the definition of “minority shareholder” in this subsection, the date of publication of the notice of delivery of the common draft terms of merger under section 470 (2)(b), or
(b) in relation to a minority shareholder referred to in paragraph (b) of that definition of “minority shareholder”, the date on which the resolution of the transferor company was passed.
Application for confirmation of merger by court
477. (1) An application under this section to the court for an order confirming a merger shall be made jointly by all the merging companies.
(2) That application shall be accompanied by a statement of the size of the shareholding of any shareholder who has requested the purchase of his or her shares under section 476 and of the measures which the successor company proposes to take to comply with the shareholder’s request.
Protection of creditors
478. A creditor of any of the merging companies who, at the date of publication of the notice under section 470 (2)(b) is entitled to any debt or claim against the company, shall be entitled to be heard in relation to the confirmation by the court of the merger under section 480 .
Preservation of rights of holders of securities
479. (1) Subject to subsection (2), holders of securities, other than shares, in any of the companies being acquired to which special rights are attached shall be given rights in the successor company at least equivalent to those they possessed in the company being acquired.
(2) Subsection (1) shall not apply—
(a) where the alteration of the rights in the acquiring company has been approved—
(i) by a majority of the holders of such securities at a meeting held for that purpose, or
(ii) by the holders of those securities individually,
or
(b) where the holders of those securities are entitled under the terms of those securities to have their securities purchased by the successor company.
Confirmation order
480. (1) Where an application is made under section 477 to the court for an order confirming a merger this section applies.
(2) The court, on being satisfied that—
(a) the requirements of this Chapter have been complied with,
(b) proper provision has been made for—
(i) any minority shareholder in any of the merging companies who has made a request under section 476 , and
(ii) any creditor of any of the merging companies who objects to the merger in accordance with section 478 ,
(c) the rights of holders of securities other than shares in any of the companies being acquired are safeguarded in accordance with section 479 , and
(d) where applicable, the relevant provisions of Chapter 4 of Part 3 on the variation of the rights attached to any class of shares in any of the merging companies have been complied with,
may make an order confirming the merger with effect from such date as the court appoints (the “effective date”).
(3) The order of the court confirming the merger shall, from the effective date, have the following effects:
(a) all the assets and liabilities of the transferor company or companies are transferred to the successor company;
(b) in the case of a merger by acquisition or a merger by formation of a new company, where no request has been made by minority shareholders under section 476 , all remaining members of the transferor company or companies except the successor company (if it is a member of a transferor company) become members of the successor company;
(c) the transferor company or companies is or are dissolved;
(d) all legal proceedings pending by or against any transferor company shall be continued with the substitution, for the transferor company, of the successor company as a party;
(e) the successor company is obliged to make to the members of the transferor company or companies any cash payment required by the common draft terms of merger;
(f) every contract, agreement or instrument to which a transferor company is a party shall, notwithstanding anything to the contrary contained in that contract, agreement or instrument, be read and have effect as if—
(i) the successor company had been a party thereto instead of the transferor company,
(ii) for any reference (however worded and whether express or implied) to the transferor company there were substituted a reference to the successor company, and
(iii) any reference (however worded and whether express or implied) to the directors, officers, representatives or employees of the transferor company, or any of them—
(I) were, respectively, a reference to the directors, officers, representatives or employees of the successor company or to such director, officer, representative or employee of the successor company as the successor company nominates for that purpose, or
(II) in default of such nomination, were, respectively, a reference to the director, officer, representative or employee of the successor company who corresponds as nearly as may be to the first-mentioned director, officer, representative or employee;
(g) every contract, agreement or instrument to which a transferor company is a party becomes a contract, agreement or instrument between the successor company and the counterparty with the same rights, and subject to the same obligations, liabilities and incidents (including rights of set-off), as would have been applicable thereto if that contract, agreement or instrument had continued in force between the transferor company and the counterparty;
(h) any money due and owing (or payable) by or to a transferor company under or by virtue of any such contract, agreement or instrument as is mentioned in paragraph (g) shall become due and owing (or payable) by or to the successor company instead of the transferor company; and
(i) an offer or invitation to treat made to or by a transferor company before the effective date shall be read and have effect, respectively, as an offer or invitation to treat made to or by the successor company.
(4) The following provisions have effect for the purposes of subsection (3)—
(a) “instrument” in that subsection includes—
(i) a lease, conveyance, transfer, charge or any other instrument relating to real property (including chattels real); and
(ii) an instrument relating to personalty;
(b) paragraph (f)(ii) of that subsection applies in the case of references to the transferor company and its successors and assigns as it applies in the case of references to the transferor company personally;
(c) paragraph (g) of that subsection applies in the case of rights, obligations and liabilities mentioned in that paragraph whether they are expressed in the contract, agreement or instrument concerned to be personal to the transferor company or to benefit or bind (as appropriate) the transferor company and its successors and assigns.
(5) Without prejudice to subsections (6) and (7), the successor company shall comply with registration requirements and any other special formalities required by law and as directed by the court for the transfer of the assets and liabilities of the transferor company or companies to be effective in relation to other persons.
(6) There shall be entered by the keeper of any register in the State—
(a) upon production of a certified copy of the order under subsection (2); and
(b) without the necessity of there being produced any other document (and, accordingly, any provision requiring such production shall, if it would otherwise apply, not apply),
the name of the successor company in place of any transferor company in respect of the information, act, ownership or other matter in that register and any document kept in that register.
(7) Without prejudice to the generality of subsection (6), the Property Registration Authority, as respects any deed (within the meaning of section 32 of the Registration of Deeds and Title Act 2006 ) registered by that Authority or produced for registration by it, shall, upon production of the document referred to in subsection (6)(a) but without the necessity of there being produced that which is referred to in subsection (6)(b), enter the name of the successor company in place of any transferor company in respect of such deed.
(8) Without prejudice to the application of subsection (6) to any other type of register in the State, each of the following shall be deemed to be a register in the State for the purposes of that subsection:
(a) the register of members of a company referred to in section 169 ;
(b) the register of holders of debentures of a public limited company kept pursuant to section 1120 ;
(c) the register kept by a public limited company for the purposes of sections 1048 to 1053 ;
(d) the register of charges kept by the Registrar pursuant to section 414 ;
(e) the Land Registry;
(f) any register of shipping kept under the Mercantile Marine Act 1955 .
(9) If the taking effect of the merger would fall at a time (being the time ascertained by reference to the general law and without regard to this subsection) on the particular date appointed under subsection (2) that is a time that would not, in the opinion of the court, be suitable having regard to the need of the parties to co-ordinate various transactions, the court may, in appointing a date under subsection (2) with respect to when the merger takes effect, specify a time, different from the foregoing, on that date when the merger takes effect and, where such a time is so specified—
(a) the merger takes effect on that time of the date concerned, and
(b) references in this section to the effective date shall be read accordingly.
Certain provisions not to apply where court so orders
481. Where the court makes an order confirming a merger under this Chapter, the court may, if it sees fit for the purpose of enabling the merger properly to have effect, include in the order provision permitting—
(a) the giving of financial assistance which may otherwise be prohibited under section 82 ,
(b) a reduction in company capital which may otherwise be restricted under section 84 .
Registration and publication of confirmation of merger
482. (1) If the court makes an order confirming a merger, a certified copy of the order shall forthwith be sent to the Registrar by such officer of the court as the court may direct.
(2) Where the Registrar receives a certified copy of the order of the court in accordance with subsection (1), the Registrar shall—
(a) on, or as soon as practicable after, the effective date — register in the register that certified copy and the dissolution of the transferor company or companies, and
(b) within 14 days after the date of that delivery — cause to be published in the CRO Gazette notice that a copy of an order of the court confirming the merger has been delivered to him or her.
Civil liability of directors and experts
483. (1) Any shareholder of any of the merging companies who has suffered loss or damage by reason of misconduct in the preparation or implementation of the merger by a director of any such company or by the expert, if any, who has made a report under section 468 shall be entitled to have such loss or damage made good to him or her by—
(a) in the case of misconduct by a person who was a director of that company at the date of the common draft terms of merger — that person,
(b) in the case of misconduct by any expert who made a report under section 468 in respect of any of the merging companies — that person.
(2) Without prejudice to the generality of subsection (1), any shareholder of any of the merging companies who has suffered loss or damage arising from the inclusion of any untrue statement in any of the following, namely:
(a) the common draft terms of merger;
(b) the explanatory report, if any, referred to in section 467 ;
(c) the expert’s report, if any, under section 468 ;
(d) the merger financial statement, if any, prepared under section 469 ,
shall, subject to subsections (3) and (4), be entitled to have such loss or damage made good to him or her—
(i) in the case of the document or report referred to in paragraph (a), (b) or (d) — by every person who was a director of that company at the date of the common draft terms of merger, or
(ii) in the case of the report referred to in paragraph (c) — by the person who made that report in relation to that company.
(3) A director of a company shall not be liable under subsection (2) if he or she proves—
(a) that the document or report referred to in subsection (2)(a), (b) or (d), as the case may be, was issued without his or her knowledge or consent and that, on becoming aware of its issue, he or she forthwith informed the shareholders of that company that it was issued without his or her knowledge or consent, or
(b) that as regards every untrue statement he or she had reasonable grounds, having exercised all reasonable care and skill, for believing and did, up to the time the merger took effect, believe that the statement was true.
(4) A person who makes a report under section 468 in relation to a company shall not be liable in the case of any untrue statement in the report if he or she proves—
(a) that, on becoming aware of the statement, he or she forthwith informed that company and its shareholders of the untruth, or
(b) that he or she was competent to make the statement and that he or she had reasonable grounds for believing and did up to the time the merger took effect believe that the statement was true.
Criminal liability for untrue statements in merger documents
484. (1) Where any untrue statement has been included in—
(a) the common draft terms of merger,
(b) the explanatory report, if any, referred to in section 467 , or
(c) the merger financial statement, if any, prepared under section 469 ,
the following:
(i) each of the persons who was a director of any of the merging companies at the date of the common draft terms of merger or, in the case of the foregoing explanatory report or merger financial statement, at the time of the report’s or statement’s preparation; and
(ii) any person who authorised the issue of the document;
shall be guilty of a category 2 offence.
(2) Where any untrue statement has been included in the expert’s report prepared under section 468 , the expert and any person who authorised the issue of the report shall be guilty of a category 2 offence.
(3) In any proceedings against a person in respect of an offence under subsection (1) or (2), it shall be a defence to prove that, having exercised all reasonable care and skill, the defendant had reasonable grounds for believing and did, up to the time of the issue of the document concerned, believe that the statement concerned was true.
The text in italics on this page is sourced from the Irish Statute Book and is re-published under the Licence for Re-Use of Public Sector Information made pursuant to Directive 2003/98/EC Directive 2013/37/EU of the European Parliament and of the Council on the re-use of public sector information transposed into Irish law by the European Communities (Re-Use of Public Sector Information) Regulations 2005 to 2015.