Choice of method - reconstructions , Business Law and Ethics

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Choice Of Method:

There are three statutory methods to be considered:

         Where one company offers to acquire the shares of another company and its offer is accepted by holders of 90 per cent or more of the shares for which the offer is made the acquiring company may compel the non-accepting minority to transfer their shares on the same terms.  This is the standard procedure for "mopping up a minority" and achieving complete success in a take-over bid.  It is no objection that the acquiring company already owns (directly or through subsidiaries) some shares of the other company.  Accordingly this method is also available to acquire the outstanding minority shareholding of a partly-owned subsidiary (s.210).


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