The Companies Act No. 17 of 2015Section 389 of The Companies Act No. 17 of 2015: Merger relief: meaning of ninety percent equity holding
(1) This section applies for the purpose of determining whether a company has, for the purposes of section 388, acquired at least a ninety percent equity holding in another company under an arrangement referred to in subsection (1) of that section.
(2) For the purpose referred to in subsection (1), a company acquires at least a ninety percent equity holding in another company if, as a result of an acquisition or a cancellation of equity shares in another company (under an arrangement referred to in section 388(1), it holds equity shares in the other company of an aggregate amount equal to ninety percent or more of the nominal value of the other company's equity share capital.
(3) For the purpose of subsection (2)—
(a) it does not matter whether any of the shares were acquired under the arrangement; and
(b) shares in the other company held by the acquiring company as treasury shares are to be disregarded in determining the nominal value of the other company's share capital.
(4) If the equity share capital of the other company is divided into different classes of shares, the acquiring company is taken to have acquired at least a ninety percent equity holding in the other company only if the requirements of subsection (2) are satisfied in relation to each of those classes of shares taken separately.
(5) For the purposes of this section, shares held by—
(a) a company that is the acquiring company's holding company or subsidiary;
(b) a subsidiary of the acquiring company’s holding company; or
(c) its or their nominees, are taken to be held by the acquiring company.
Check the current authoritative text and amendment history before relying on this provision.
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