Shyam Metalics subsidiary secures NCLT approval to merge aluminium foil unit
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Shyam Sel and Power Ltd, a wholly-owned subsidiary of Shyam Metalics and Energy Ltd, has received approval from the National Company Law Tribunal (NCLT), Kolkata Bench, to merge Shree Venkateshwara Electrocast Pvt Ltd into its operations, effective April 1, 2024.
According to a company statement, the tribunal approved the scheme of amalgamation through an order dated October 16, 2026. The merger is intended to bring aluminium foil operations under a single entity, allowing the company to streamline manufacturing and marketing activities while improving operational efficiency and working capital management.
Merger to consolidate aluminium foil operations
The merger will transfer the business of Shree Venkateshwara Electrocast to Shyam Sel and Power, consolidating the two entities' operations under one company. As part of the arrangement, all assets, liabilities, contracts and employees of Shree Venkateshwara Electrocast will vest in Shyam Sel and Power.
The transaction will not involve the issuance of fresh equity shares, as Shree Venkateshwara Electrocast is already a wholly-owned subsidiary of Shyam Sel and Power. Its existing share capital will be cancelled once the scheme is implemented.
Following the filing of a certified copy of the NCLT order with the Registrar of Companies, West Bengal, Shree Venkateshwara Electrocast will be dissolved without winding up.
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Scheme provides for potential tax benefits
Alongside the operational changes, the merger is expected to offer tax benefits to Shyam Sel and Power, subject to the applicable statutory conditions.
Under Section 72A of the Income-tax Act, the company may be able to set off eligible accumulated business losses and unabsorbed depreciation of Shree Venkateshwara Electrocast. This provision forms part of the financial arrangements associated with the amalgamation, alongside the consolidation of aluminium foil manufacturing and marketing activities.
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