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Capital Trust board nods amalgamation of Capital Trust Microfinance and Capital Trust Housing Finance

Amalgamation would result in optimum and efficient utilization of resources either in form of assets or sharing of ancillary facilities. The benefit of obtaining synchronization of synergies.

December 20, 2021 10:40 IST | India Infoline News Service
The Board of Directors of the company has approved the Scheme of amalgamation of Capital Trust Microfinance Private Limited and Capital Trust Housing Finance Private Limited (“Transferor Companies”) with Capital Trust Limited.

Capital Trust Microfinance Private Limited and Capital Trust Housing Finance Private Limited are wholly owned subsidiaries of Capital Trust Limited.

“The Scheme is subject to necessary statutory and regulatory approvals including the approvals of National Company Law Tribunal, the Shareholders and Creditors of each of the companies,” the company said in a filing.

The business activities of the Transferor Companies are ancillary and incidental to the main business operations of the Transferee Company. Amalgamation would result in the following benefits to the Transferee Company:
  • Optimum and efficient utilization of resources either in form of assets and sharing of ancillary facilities;
  • Benefit of obtaining synchronization of synergies;
  • Structured, sharper and better management focussing on holistic growth of the businesses;
  • Rationalizing multiple subsidiaries in the group to ensure optimized legal entity structure more aligned with the business by reducing the number of legal entities and re-organizing the legal entities in the group structure;
  • Significant reduction in the multiplicity of legal and regulatory compliances required at present to be carried out by the Transferor Companies and the Transferee Company;
  • Concentrated effort and focus by the management to grow the business by eliminating duplicative communication and burdensome co-ordination efforts across multiple entities;
  • Cost saving by way of reduction of overheads, administrative, managerial and other expenditure and to bring about operational rationalization and efficiency; and
  • Synchronization of efforts to achieve uniform corporate policy and ease in decision making at the group level of the Transferee Company.
  • Further, there is no adverse effect of this Scheme on the directors, key management personnel, promoters, non-promoter members, creditors and employees of the Companies and the same would be in the best interest of all stakeholders.
At around 10.44 am, Capital Trust Ltd was trading at Rs112.10 per piece down by Rs5.65 or 4.8% from its previous closing of Rs117.75 per piece on the BSE.

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