Preparing documents for a long-form amalgamation

Getting the proposal and other certificates, notices and consents ready

Preparing for a long-form amalgamation involves the collaboration of directors from all the companies to make sure the documentation is correct and complete. You also need approval from your shareholders. 

What you need to prepare

Before you file a long-form amalgamation, there's information you need to gather and decisions you need to make.

For a long-form amalgamation, you need to document your amalgamation plans and advise anyone with an interest in the amalgamation. To do this you need to prepare:

  • a proposal
  • resolutions
  • certificates
  • notices
  • consents and information about your directors, and
  • approvals.

Amalgamation proposal

The proposal sets out the terms of the amalgamation and the date the amalgamation will take effect, if you want to include that. It also outlines how the companies will manage the amalgamation.

It includes details about the amalgamated company such as:

  • its name
  • the name of the ultimate holding company of each amalgamating company and of the amalgamated company
  • the registered office and address for service
  • who the directors will be with their full names and addresses.

It defines how the amalgamated company will:

  • structure its shares
  • convert shares in any companies that will to be removed from the Companies Register to shares in the amalgamated company, or
  • compensate holders of those shares, if the shares aren't going to be converted to shares in the amalgamated company.

The proposal also describes how you'll manage the transition to the amalgamated company.

What your proposal must include is set out in Section 220 of the Companies Act 1993.

Resolutions

Each board and the shareholders of the amalgamating companies must pass resolutions before you can apply to amalgamate the companies.

Any shareholders who vote against a proposal that is approved can make the company buy their shares.

The directors of each amalgamating company pass resolutions confirming that:

  • the amalgamation is in the best interest of the company, and
  • the board is satisfied that the amalgamated company will satisfy the solvency test immediately after the amalgamation comes into effect.

Don't provide the resolutions to the Companies Office when you file your amalgamation — they're for the company's own records.

Certificates

Amalgamating companies — certificates to prepare

The directors of each amalgamating company must prepare and sign certificates confirming that:

  • the amalgamation is in the best interest of the company, giving reasons for their opinion
  • the amalgamated company will satisfy the solvency test, giving the reasons for their opinion
  • the amalgamation has been approved by the board of each company in accordance with the Companies Act 1993, and the company's constitution, if it has one.

Best interest of the company

How you explain the best interest will vary with each amalgamation. Examples include:

  • savings on administrative costs, or
  • commercial advantages, such as being able to combine supply and retail businesses.

Amalgamated company — certificate to prepare

The directors of the intended amalgamated company must prepare and sign a certificate confirming that any creditors who will be adversely affected won't be prejudiced — that is, payments owing to them won't be put at risk.

How to prepare certificates

Follow this format when you prepare a certificate.

  • Put the name of the company at the top of the page.
  • Add a heading, 'Certificate under Section [add the appropriate reference] of the Companies Act 1993'.
  • Start the text, 'I/we certify that [add the reason for the certificate]'.
  • Add any further information that you need to include, for example the reasons the directors have for certifying that the amalgamated company will meet the solvency test. Check the relevant sections of the Act to find out what other information you must include in the certificate.
  • Date the document and get it signed.

Notices

At least 20 working days before your amalgamation comes into effect, you need to notify:

  • secured creditors — by sending them a copy of your amalgamation proposal
  • the public — by publishing your intention to amalgamate
  • shareholders — by sending them the documents listed in Section 221 of the Companies Act 1993, including the amalgamation proposal and certificates relating to the amalgamation.

Giving public notice

You give public notice by publishing your intention to amalgamate in:

  • the New Zealand Gazette, and
  • at least 1 newspaper in circulation in the area where your business is located.

Consents and information about directors

Directors' consents

Provide your directors' consents by completing a Form 13 for each director.

Director information

Prepare a document including the name of the amalgamated company and, for each director, their:

  • full legal name
  • date and place of birth — the town or city, and the country.

The document doesn't need to be dated or signed.

Approvals and other documents

If the amalgamated company is changing its name

If the amalgamated company is going to have a new name, you need to apply to reserve the name. You don't need to prepare a separate notice of the change of name if you include this in your amalgamation proposal.

If the amalgamated company is keeping an existing company name

If the amalgamated company is keeping the name of one of the amalgamating companies, you need to provide a completed Form 4.

If one of the amalgamating companies is a licensed insurer

If an amalgamating company is a licensed insurer, you must provide a copy of the written approval of the Reserve Bank of New Zealand.

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