{"id":3662,"date":"2021-03-28T10:02:03","date_gmt":"2021-03-28T10:02:03","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=3662"},"modified":"2021-03-25T10:54:00","modified_gmt":"2021-03-25T10:54:00","slug":"documents-required-for-mergers-and-acquisitions","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/documents-required-for-mergers-and-acquisitions\/","title":{"rendered":"What are the Documents Required for Mergers and Acquisitions?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">There\nare many steps in the process of mergers and acquisitions and can often take to\ncomplete from six months to several years.&nbsp;\nBut before starting the process of <strong><a href=\"https:\/\/swaritadvisors.com\/mergers-and-acquisitions\" class=\"text-primary\">mergers and\nacquisitions<\/a><\/strong>, you need to prepare all the essential documents required\nfor Mergers and Acquisitions. The documentation part of mergers and\nacquisitions is of supreme importance. It can be considered as the depth of\nmerger and acquisition. In this blog, we discuss the documents required for\nmergers and acquisitions.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3a8c7973c16\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3a8c7973c16\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-mergers-and-acquisitions\/#What_is_a_Mergers_and_Acquisitions_%E2%80%93_An_Overview\" title=\"What is a Mergers and Acquisitions? \u2013 An Overview\">What is a Mergers and Acquisitions? \u2013 An Overview<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-mergers-and-acquisitions\/#What_are_the_Essential_Documents_Required_for_Mergers_and_Acquisitions\" title=\"What are the Essential Documents Required for Mergers and Acquisitions?\">What are the Essential Documents Required for Mergers and Acquisitions?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-mergers-and-acquisitions\/#Different_Stages_and_Further_Documents_Required_for_Mergers_and_Acquisitions\" title=\"Different Stages and Further Documents Required for Mergers and\nAcquisitions\">Different Stages and Further Documents Required for Mergers and\nAcquisitions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-mergers-and-acquisitions\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_a_Mergers_and_Acquisitions_%E2%80%93_An_Overview\"><\/span>What is a Mergers and Acquisitions? \u2013 An Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>When\ntwo companies or entities combine and form a new single company or entity, it\nis called a merger. For example, when a company X and a company Y combine and\nform a new single company XY, it&#8217;s a merger. Whereas acquisition is very\ndifferent from a merger, a company purchases another company or entity. When\nCompany X buys Company Y and makes it a part of Company X, it is acquisition. In\nsimple words, one company overtakes another company. Like how some nations were\nso interested in winning other nations to strengthen their power, wealth and\nexpanding their boundaries, many companies are willing to buy other companies\nthat have a good customer base and market position in today&#8217;s world. For\nexample, recently, in 2020, Zomato buys Uber Eats. <\/p>\n\n\n\n<p>Mergers and acquisitions are used in different fields to upsurge the customer base, expand the business, combine wealth, enter into a market through a well-recognized company, and gain a good position and power. It is also essential to eliminate competitions or competitors. After understanding the definition of mergers and acquisition, let us know all the vital documents required for mergers and acquisitions.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/benefits-of-mergers-and-acquisitions\/\">What are the Benefits of Mergers and Acquisitions?<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Essential_Documents_Required_for_Mergers_and_Acquisitions\"><\/span>What are the Essential Documents Required for Mergers and Acquisitions?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Following\nis the list of all the vital documents required for Mergers and Acquisitions:<\/p>\n\n\n\n<ul><li><strong><em>Articles of Incorporation<\/em><\/strong>:\nModifications to the Articles of Incorporation of the enduring company are vital.\nThis comprises the issuance of a new class of shares, if any, as per the\nAcquisition Agreement, changes in the company&#8217;s name, any change in the purpose\nclause, development details by the company, etc.<\/li><li><strong><em>Letter of Intent<\/em><\/strong>: This\ndocument is the commencement of a merger and acquisition transaction. The\nsignificance of this document is sometimes not observed by the seller. The\nseller has to consider the Letter of Intent with the same diligence which they\nmake for other documents in merger and acquisition transaction. Though the\ndocument is non-binding, some clauses like individuality, confidentiality,\ntermination, governing law &amp; adjudication, fees, and expenses of the Letter\nof Intent are binding.<\/li><li><strong><em>Acquisition Agreement<\/em><\/strong>: Parties\nin the transaction will come into an Acquisition Agreement which is a binding\ndocument. This agreement includes the terms of the deal entered between\nparties. The primary clauses in an acquisition agreement are interpretation,\ndescription, representations, conditions, indemnification, contracts,\nwarranties, etc. The acquisition agreement should be carefully drafted to avoid\nfuture arguments or uncertainties.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Different_Stages_and_Further_Documents_Required_for_Mergers_and_Acquisitions\"><\/span>Different Stages and Further Documents Required for Mergers and\nAcquisitions<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The procedure for Merger and Acquisition is not an easy process that can be concluded between the parties involved, and it requires approval from the National Company Law Tribunal. Let\u2019s check the various stages and some additional documents required for Mergers and Acquisitions:<\/p>\n\n\n\n<ul><li><strong><em>Step 1: Drafting Scheme of Amalgamation<\/em><\/strong>: This\nis the crucial stage, and this document sets out the terms and conditions of\nthe whole process. Hence after a long time or negotiation only, the document is\ndrafted. It is a major document that comprises the following clauses:<\/li><\/ul>\n\n\n\n<ol><li>Legal Proceedings.<\/li><li>Accounting Treatment.<\/li><li>Preamble.<\/li><li>Interpretations and Definitions.<\/li><li>Operative and Effective dates clauses.<\/li><li>Accounting Treatment.<\/li><li>Transfer and Vesting Clauses.<\/li><li>Clause for general terms and others.<\/li><li>Staffs and Employees of the Transferee Company.<\/li><li>Share\nCapital Clauses.<\/li><\/ol>\n\n\n\n<ul><li><strong><em>Step 2: Approval of BODs<\/em><\/strong>: Once\nthe above step is done, then the next step is to get the approval of Boards of\nDirectors (BODs). In this step, the drafted or prepared Scheme of Amalgamation\nis shown before the approval of the Boards of Directors. Without the consent of\nthe board, the next steps are nor possible.<\/li><li><strong><em>Step 3: Filing of Petition before NCLT<\/em><\/strong>: Once\nyou get approval from the Board of Directors, a petition is filed before <strong><em>NCLT\n(National Company Law Tribunal)<\/em><\/strong> for approving the Scheme of\nAmalgamation and the company\u2019s merger and acquisition. Both the Transferee and\nTransferor must file this petition as per the provisions in the Companies Act.\nThe petitions will be submitted in <strong><em>Form NCLT-1<\/em><\/strong> along with the admission\nnotice in <strong><em>FormNCLT-2<\/em><\/strong>, an affidavit in <strong><em>Form NCLT-6<\/em><\/strong>, a copy of\nthe Scheme of Agreement and Compromise.<\/li><\/ul>\n\n\n\n<p><strong>Following are some documents to be\nsubmitted by Transferor:<\/strong><\/p>\n\n\n\n<ol><li><a href=\"https:\/\/en.wikipedia.org\/wiki\/Memorandum_of_association\">MOA<\/a> (Memorandum of Association) and AOA (Articles of Association).<\/li><li>Submit a consent affidavit filed by the number of unsecured creditors. <\/li><li>Audited Balance Sheet.<\/li><li>Detailed list of all equity shareholders.<\/li><li>Auditor\u2019s Certificating defining the number of Secured Creditors.<\/li><li>Auditor\u2019s Certificating defining the number of Unsecured Creditors.<\/li><li>Submit a Board Resolution for authorization and approval of the scheme.<\/li><li>Affidavits filed by the Equity Shareholders.<\/li><li>Submit the Auditor\u2019s Certification about the accounting treatment prescribed in the Scheme of Amalgamation. <\/li><\/ol>\n\n\n\n<p><strong>Following are some documents to be\nsubmitted by Transferee:<\/strong><\/p>\n\n\n\n<ol><li>Submit a consent affidavit filed by the number\nof unsecured creditors. <\/li><li>Audited Balance Sheet.<\/li><li>Detailed list of all equity shareholders.<\/li><li>Submit a Board Resolution for authorization and\napproval of the scheme.<\/li><li>Affidavits filed by the Equity Shareholders.<\/li><li>Submit the Auditor\u2019s Certification about the\naccounting treatment prescribed in the Scheme of Amalgamation. <\/li><li>MOA (Memorandum of Association) and AOA\n(Articles of Association).<\/li><li>Auditor\u2019s Certificating defining the number of\nSecured Creditors.<\/li><li>Auditor\u2019s Certificating defining the number of\nUnsecured Creditors.<\/li><\/ol>\n\n\n\n<p><strong><em>Additional\nDocuments:<\/em><\/strong><\/p>\n\n\n\n<ol><li>Observation Letter delivered by the Stock Exchanges approving the Scheme of Amalgamation;<\/li><li>Submit a Certificate of CA for non-applicability of getting a Valuation Report;<\/li><li>Undertaking regarding the Non-Applicability of paragraph I(A) 9(a) of Annexure I of SEBI Circular No. CIR\/CFD\/CMD\/16\/2015 dated November 30, 2015;<\/li><li>Fairness Opinion delivered by the Merchant Banks on the Amalgamation Scheme.<\/li><\/ol>\n\n\n\n<ul><li><strong><em>Step 4: Meetings of the Creditors &amp; Shareholders<\/em><\/strong>: The NCLT may cancel the petition for a suitable reason. Otherwise, it will go straight for the meetings of the creditors and shareholders for getting approval for M&amp;A. A notification in the <strong><em>Form CAA-2<\/em><\/strong> is sent to them through speed post\/ email\/ courier or hand-on delivery or any other modes as directed by the Tribunal.<\/li><li><strong><em>Step 5: Getting Approval from Regional Director<\/em><\/strong>: No objection from the Official Receiver or Regional Director is mandatory. Official Receiver of Liquidators operates under the Regional Director, who observers the working of Official Liquidators. They are selected by the Central Government of India under Section 448 of the Companies Act, 1956.<\/li><li><strong><em>Step 6: Filing of Final Petition<\/em><\/strong>: NCLT will look into the complete process and if it is pleased that the meeting of creditors and shareholders and all other processes are perfectly carried out as per the provisions and will check if the auditor of a company has certified the company\u2019s accounting standards, provides the order in the <strong><em>Form CA<\/em>A<em>-6.<\/em><\/strong><\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Mergers and Acquisitions are used as instruments for momentous growth and are getting accepted by Indian businesses like never before. The above-mentioned documents required for Mergers and Acquisitions process therefore adhere to the above mentioned requirements sincerely.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/procedure-for-mergers-and-acquisitions\/\">Procedure for Mergers and Acquisitions: A Simplified Guide<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>There are many steps in the process of mergers and acquisitions and can often take to complete from six months to several years.&nbsp; But before starting the process of mergers and acquisitions, you need to prepare all the essential documents required for Mergers and Acquisitions. The documentation part of mergers and acquisitions is of supreme [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":3663,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[68,64],"tags":[542],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3662"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=3662"}],"version-history":[{"count":5,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3662\/revisions"}],"predecessor-version":[{"id":3669,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3662\/revisions\/3669"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/3663"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=3662"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=3662"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=3662"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}