Fintech giant Pine Labs has secured approval from the National Company Law Tribunal for its planned merger of its Indian and Singaporean entities. The approval permits the amalgamation of Pine Labs' subsidiary in Singapore into its parent company in India.
The tribunal noted in its order that the merger aims to achieve significant benefits, including enhanced business synergies and economies of scale. It is expected to streamline operations, reduce administrative and compliance costs, and consolidate resources by eliminating duplications between the two countries. The move is also projected to strengthen the company's capital base and overall growth potential.
The merger will simplify Pine Labs' shareholding structure by enabling shareholders of the Singapore entity to directly hold shares in the Indian entity, thereby improving shareholder engagement and reducing the complexity of shareholding tiers.
Under the proposed plan, the Singapore entity will cease to exist as a separate legal entity, dissolving without winding up under Singapore's Companies Act. This restructuring is part of Pine Labs' strategy to optimise its operations and manage its business more effectively.
The Reserve Bank of India needs to approve the merger scheme alongside other statutory bodies such as the Regional Director of the Ministry of Corporate Affairs, the Registrar of Companies in Delhi and Haryana, and the Income Tax Department.
Additionally, Pine Labs has indicated that the merger qualifies for an exemption from notification to the Competition Commission of India, as the transaction involves a holding company and its wholly-owned subsidiary, thereby falling under the Group Company Exemption provisions.
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