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Amalgamation is form of business combination. It is used as some other meaning like merger, absorption, consolidation, acquisition etc.\u00a0[1<\/a>]<\/span>\u00a0It occurs When a company wants to expand their business in terms of long term profitability under a mutual setting by two parties.\u00a0[2<\/a>]<\/span><\/p>\n According to the Halsbury\u2019s Law of England:<\/p>\n \u201cAmalgamation is a blending of two or more existing undertaking into one undertaking, the shareholders of each blending company becoming substantially the shareholders in the company which is to carry on the blended undertaking. There may be amalgamtion either by the transfer of two or more undertakings to a new company, or by the transfer of one or more undertakings to an existing company. Strictly \u2018amalgamtion does, not, it seem, cover in the mere acquisition by a company of the sahre capital of other companies which remain in existence and continue their undertakings, but the context to which the term is used may show that it is intended to include such an acquisition.\u201d<\/p>\n<\/blockquote>\n Amalgamtion can also be defined as\u00a0[3<\/a>]<\/span>\u00a0\u201c Amalgamation takes place when two or more comapanies combine into one company, the shareholders in the amalgamting companies becoming substantially the shareholders in the amalgamted company.\u201d<\/p>\n In more common way, Amalgamtion would mean the two business entities joining together to make totally new business entity or to allow one business entity to survive absorbing the other one. Amalgamation or merger is also a method of reconstruction. In amalgamation, two or more companies are fused into one by merger or by one taking over the other.\u00a0[4<\/a>]<\/span>\u00a0When two companies are merged and are so joined as to form third company or one is absorbed into other or blended with another, the amalgamating company loses its identity. There may be amalgamation either by transfer of two or more undertakings to a new company or by the transfer of one or more undertakings to an existing company. An amalgamation may be defined as an arrangement whereby the assets of the two companies which has as its share holders all, or substantially all the share holders of the two companies\u00a0[5<\/a>]<\/span><\/p>\n It may be observed that there may be amalgamation either by the transfer of one or more undertakings to a new company or by the transfer of one or more undertaking to an existing company.<\/p>\n Usually amalgamation happens through 2 ways.<\/p>\n Absorption<\/strong>:\u00a0[6<\/a>]<\/span>\u00a0A combination of two or more companies into an existing company is known as \u2018absorption\u2019. In absorption all companies expect one go into liquidation and lose their separate identities.\u00a0 E.g. Absorption of GMG Airlines Ltd. by Beximco Group.<\/p>\n Consolidation<\/strong>:\u00a0[7<\/a>]<\/span>\u00a0\u00a0A consolidation is a combination of two or more companies into a new company. In this form of merge, all the existing companies, which combine, go into a new company. In this form of merger, all the existing companies, which combine, go into liquidation and form a new company with a different entity. The entity of the existing company is lost and their assets and liabilities are taking over by the new corporation or company. The assets of old concern are sold to a new concern and their management and control also passes into the hands of the new concern.eg. there are two companies called A ltd. and B Ltd. and they merge together to form a new company called AB Ltd. or C Ltd. it is a case of consolidation . The term consolidation is also sometimes used as amalgamation.<\/p>\n From the business perspective when two or more companies merge together or amalgamate another to form a new one; on that basis we can classify amalgamation into the five kinds.<\/p>\n In the judgment of Stamp L.J. in the case of\u00a0Crane Fruehauf Limited v IRC\u00a0[1975] 1 All ER 429 he indicated that an amalgamation can be achieved in the following ways:<\/p>\n The undertaking of the target company is acquired by the acquiring company in return for the issue of shares in the acquiring company to the target company (a two party share for undertaking swap)<\/p>\n The undertaking of the target company is acquired by the acquiring company in return for the issue of shares in the acquiring company to the shareholders of the target company (a three party share for undertaking swap)<\/p>\n The shares of the target company are acquired by the acquiring company in return for the issue of shares in the acquiring company to the shareholders of the target company (a share for share swap).<\/p>\n\n
2. How Amalgamation Happens:<\/h2>\n
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3. Classification of amalgamation:<\/h2>\n
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4. Procedure of AMALGAMATION\u00a0[8<\/a>]<\/span><\/h2>\n