NCLT Ahmedabad Clears First Motion In Orient Cement-Ambuja Cements Merger, Orders Shareholder Meetings
The Ahmedabad bench of the National Company Law Tribunal (NCLT) has directed meetings of the equity shareholders of Orient Cement Ltd. and Ambuja Cements Ltd. to consider their proposed scheme of amalgamation.
It dispensed with meetings of the companies' secured and unsecured creditors, as well as their preference shareholders.
The order was passed by Judicial Member Shammi Khan and Technical Member Sanjeev Sharma.
The application was filed by Orient Cement and Ambuja Cements for the proposed merger of Orient Cement into Ambuja Cements with effect from May 1, 2025.
The companies submitted that Ambuja Cements had acquired a 72.66% stake in Orient Cement by May 31, 2026, through acquisitions from the erstwhile promoters and an open offer.
They also told the tribunal that although Orient Cement had sanctioned credit facilities, no amount had been drawn and there were no outstanding dues. No-objection certificates had nevertheless been obtained from all secured creditors, while Ambuja Cements had no secured creditors. The companies further submitted that no investigation or winding-up proceedings were pending against either of them.
Referring to the Bombay High Court's ruling in Mahaamba Investments Ltd. v. IDI Ltd., the tribunal found that the scheme did not affect the rights of unsecured creditors or reduce any of their liabilities. It also noted that the transferee company would continue to have assets exceeding its liabilities after the merger. On that basis, it dispensed with meetings of the unsecured creditors of both companies.
For Applicants: Advocate Sandeep Singhi