Law: Companies Ordinance, 1984

Section: 284,287,10

Companies Ordinance (XLVII of 1984)--Ss. 284, 287 & 10 Scheme proposed for merger of appellants companies (i.e. KRM, KGM & KTM), whereby KRM and KGM upon merger in KTM were to stand dissolved without winding up Company Judge accepted objections to "swap ratio" (exchange ratio) of shares of said companies and declined to sanction scheme with observation that scheme was clearly flawed and worked seriously to disadvantage of shareholders and scheme on the face of record was unconscionable and grossly unfair to minority shareholders of KRM Appellants during pendency of Intra¬ Court Appeal filed "revised swap ratio" of shares ¬Appellants did not argue appeal with a view to obtain reversal of impugned No arguments were advanced against facts recorded, observations made and principles adopted in impugned nor any compelling reason was shown for adopting a view different from that contained therein Appellants convassed acceptance of appeal on the basis of "revised swap ratio High Court in Intra Court Appeal was not justified to re-examine the rationality and fairness of "revised swap ratio", which had not at all been considered by share¬holders of appellant companies in accordance with law Intra Court Appeal was dismissed in circumstances. JUDGMENT MUHAMMAD SAIR ALI, J. Through C.O. No.4 of 2002 approval of the learned Company Judge of this Court was sought to scheme of merger of the three appellantcompanies namely, Kohinoor Raiwind Mills Limited ("KRM"), Kohinoor (Gujar Khan) Mills Limited ("KGM") and Kohinoor Textile Mills ("KTM"). According to the proposed arrangement KRM and KGM, upon merger in KTM, were to stand dissolved without winding up. Under the scheme of arrangement proposed and approved by the shareholders of the appellant Companies in the general meetings, the surviving company i.e. KTM was to issue to the shareholders of KRM and KGM fully paid up ordinary shares of the par value of Rs. 10 each in the capital of KTM at the value to be determined by Messrs Riaz Ahmed & Co. The exchange ratio (referred to as "the swap ratio" in the present case) determined by the named Chartered Accountants was as under: A shareholder of KRML was to get 2.326…

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