Short form amalgamations

The following documents must be filed:

1. Resolutions from the board of each amalgamating company under section 222(1) or (2), as the case may be.  These are equivalent to the long form proposal (section 222(4));
2. Certificate from the directors of each amalgamating company that the amalgamated company will satisfy the solvency test immediately after the amalgamation has become effective plus the grounds for the directors’ belief that this will be so (section 222(5)).  Note | The 'best interests' point of the long form procedure is presumed in this context and is not to be included in the resolutions or certificates;
3. Certificate from the board of each amalgamating company that the amalgamation has been approved in accordance with the Act and, if the particular company has a constitution, with that constitution also (section 223(c));
4. If applicable | Certificate from the board of the intended amalgamated company  (section 223(e)).  That is, where both of two amalgamating companies or at least two companies in a multi-company amalgamation have creditors ;
5. Consents using Form 13 [55 kB PDF] from the directors of the intended amalgamated company, irrespective of whether they will be the same people as before (section 223(f)); and
6. Fee of NZ$306.67.

Types of short form amalgamations

There are two types of short form amalgamations, with similar documentation for each, changed appropriately:

Type 1 - section 222(1)

Is where the holding company must be the amalgamated company ("the company first referred to" in the section) and where its shares and constitution will continue; and

Type 2 - section 222(2)

Is where the amalgamating companies are directly or indirectly held by the same person(s), where either of two, or in the case of a multi-company amalgamation, any one of the companies, can be the amalgamated company. 

Note | All resolutions and certificates must refer to all the amalgamating companies.  A five-company amalgamation, for example, will have documents that each refer to all five names.  This is logical, as the boards are all approving the same proposed amalgamation, just as if they were all to participate in the same building project. 

FAQs

What must be included in the resolutions?

The resolutions must contain all the elements of either section 222(1) or (2), as the case may be.  These are:

• Approval of the proposed amalgamation, naming all the amalgamating companies, identifying the amalgamated company early on;
• Cancelling without payment or other compensation the shares of the company or companies that are to be removed on amalgamation;
• Identifying the constitution of the amalgamated company for the future as being that of the holding company (section 222(1)-type) or the amalgamating company the shares in which will not be cancelled (section 222(2)-type);
• Stating that on reasonable grounds the amalgamated company will satisfy the solvency test immediately after the amalgamation becomes effective; and
• Naming the director/s of the intended amalgamated company.
   

There are two possible additions – stipulating a date for the amalgamation to become effective that can be the same as the date of filing or a later date for the amalgamation to become effective (section 224(2)) and changing the name of the amalgamated company (section 223(d)).

Stipulating a date

If a date is stipulated, you must file the amalgamation documents with the Registrar on that day or earlier (section 224(2)).  Filing the amalgamation documents after the stipulated date results in the date of receipt becoming the effective date. 

Note | Any date can be stipulated, not just a working day, so weekend or holiday dates are available.  If you choose a non-working day you must ensure filing is completed on a working day prior to the stipulated date. 

For example | If you stipulate a date of Sunday 6 December 2009, you must then file the amalgamation documents with the Registrar no later than Friday 4 December 2009. 

Changing the name of the amalgamated company

A name change for the amalgamated company as part of the amalgamation is reasonably common.  In this situation, each resolution needs to resolve on the change "On amalgamation the name of the amalgamated company will be changed to X Limited" or similar. 

• If 'X Limited' is an entirely new name, you can apply for the new name online (NZ$10.22)and include the name approval with the amalgamation documents; or
• If 'X Limited' is the same name as that of a company to be removed on amalgamation, you must apply to reserve the name using a paper form (Form 4 - NZ$25.55), so the Registrar can reserve the new name as part of the registration and then apply the reservation to the amalgamated company.  There is no requirement to file a notice of board resolution to change company name, as this will be on public record with the resolutions.
  
  • Learn how to make a name application online.
  • Download form 4 to apply to reserve a company name [55 kB PDF].

   

  Which company becomes the amalgamated company?

  Section 222(1) requires the holding company to become the amalgamated company.

  Section 222(2) offers some choice in which amalgamating company is to become the amalgamated company.  This could be a company without an immediate connection to the ultimate shareholders.  The drafting has to connect the ultimate shareholder/s to the selected company.  The resolutions need to cancel the shares in the unwanted company or companies and then add "to the intent that (identified shares to be held by the ultimate shareholder/s) will be the shares in the amalgamated company."
  
  The constitution of the company whose identified shares will continue has to become that of the amalgamated company "The constitution of the amalgamated company will be the same as that of (name), the shares in which will not be cancelled."
  
  On registration, the Registrar will connect the selected shareholding and constitution to the amalgamated company.

  
  What if the intended amalgamated company does not have a constitution?

  For an intended amalgamated company that does not have a constitution as an amalgamating company, it is best to state this in the resolutions along the lines of "That the amalgamated company will not have a constitution, as A Limited does not have a constitution.  The internal procedures of the amalgamated company will continue to be governed by the Companies Act 1993."

  
   

  What notices must be given?

  The only notice required to be given is the notice to secured creditors (section 222(3) Companies Act 1993). 

 You will need PDF viewing software

To download and view the forms described here you will need PDF viewing software.