GE Shipping gets HC's approval for new demerger date
New Delhi, Aug 31 (UNI) GE Shipping today received approval from the Bombay High Court for extension of time for the delayed demerger of its offshore services business by three months.
The company stated that the court also approved the other modification to the scheme of arrangement (demerger) of the same.
The demerger of GE Shipping's unit that provides services to offshore oil rigs had originally been approved by the court in January for completion within six months.
However, the spin-off of the unit into Great Offshore Ltd. was delayed due to initial objections from Oil and Natural Gas Corporation (ONGC).
ONGC is believed to have had issues regarding the financial strength of the demerged company, since the liabilities would have to be shifted to it. ONGC wanted the parent company, GE Shipping, to bear the liability (in case of failure to execute the contract) even after the demerger.
Though, ONGC cleared the move later, GE Shipping could not complete the demerger and the deadline lapsed on August 2.
In August second week, GE Shipping revived the plan and decided to have the same founders for the parent company as well as the demerged entity.
However, consequent to the decision of the board to have identical promoters, clauses 24 and 32 in the scheme relating to inter-se transfer of shares amongst promoters have been deleted.
UNI PV CS KN1441