12.17.8 (Amalgamation of Companies in National Interest)

Where the Central Government is satisfied that it is essential in the public interest that two or more companies should amalgamate, then the Central Government may order the amalgamation of those companies into a single company with such constitution, with such property, powers, rights, interests, authorities and privileges and with such liabilities, duties and obligation as may be specified in the order.

Every member or creditor of each of the companies after the amalgamation shall have, as nearly as may be, the same interest in or rights against the company resulting from the amalgamation as he had in the company of which he was originally a member or creditor. To the extent the rights or interest of such member or creditor against or in the company resulting from the amalgamation are less than the interest in or rights against the original company, he shall be entitled to compensation which shall be assessed by such authority as may be prescribed. The compensation so assessed shall be paid to the member or creditor concerned by the company resulting from the amalgamation.

The Government, before making the order, must: (a) send a draft copy of the proposed order to each of the companies concerned; (b) have considered and made such modifications, if any, in the draft order as may seem to it desirable in the light of any suggestions and objections which may be received by it from the companies concerned, or from shareholders therein, or from any creditors thereof.

Copies of every order made under s.396 must, after it has made, be laid before both Houses of Parliament as soon as possible.