MOHTA ANOOP V., J.: - "The integration of the manufacturing and other facilities of the cement business of the petitioner-company into the resulting company and the eventual acquisition of management control of the resulting company by Grasim, will contribute to enhanced global competitiveness for the resulting company, thereby increasing its ability to compete in domestic and international markets. Increased competitiveness would contribute to the enhancement of future business of the petitioner-company and thereby contributing to the wealth of the shareholders of the petitioner-company."

The Scheme of Arrangement in question is revolving around the above objective of the Companies.

This is a Company Petition under sections 391 to 394 of the Companies Act in the matter of Scheme of Arrangement between Larsen Toubro Limited (for short "L T" or "demerged company" or "petitioner-company" or "transferor company") and UltraTech CemCo Limited (for short "CemCo" or "resulting company" or "transferee company") and their respective shareholders, creditors and Grasim Industries Limited (for short "Grasim") as a shareholder of L T and L T Employees Welfare Foundation (for short "Trust").

2. COMPANIES:

(A). Larsen Toubro Limited: Larsen Toubro was incorporated on 7th February, 1946, under the Indian Companies Act, 1913, having its registered office at L T House, Ballard Estate, Mumbai, Maharashtra. The present capital structure of the petitioner-company is as follows:

Authorised Rs. in crore

32,50,00,000 Equity shares of Rs.10 each 325.00

Issued

24,90,59,412 Equity shares of Rs.10 each 249.00

Subscribed and paid up

24,87,39,591 Equity Shares of Rs. 10 each 248.74

includes Equity Shares represented by GDRs.

(B). UltraTech CemCo Limited (for short "CemCo") was incorporated on 24th August, 2000, under the Companies Act, as L T Cement Limited, now known as UltraTech CemCo Limited, with effect from 19th November, 2003, having its registered Office situated at L T House, Ballard Estate, Mumbai, Maharashtra. The present capital structure of the company is as follows:

Authorised Rupees

3,00,00,000 Equity 30,00,00,000

of Rs. 10/- each ----------------

30,00,00,000

----------------

Issues Subscribed

3,00,00,000 Equity 30,00,00,000

of Rs. 10/- each.

Paid up

2,48,77,184 Equity

Shares of Rs. 10 each

fully paid up. 24,87,71,840

51,22,816 Equity

Shares of Rs. 10/-

each, Re. 1 per share

paid up. 51,22,816

------------------- 25,38,94,656

===========

(C). Grasim Industries Limited (for short "Grasim") is a shareholder of the demerged company having its registered Office at Birlagram, Nagda, Madhya Pradesh. It is engaged in the business of manufacture and sale of viscose staple fibre, cement, sponge iron, chemicals and textiles.

(D). The Samruddhi Swastik Trading Investment Limited (for short "Samruddhi") is a wholly owned subsidiary and an unlisted company incorporated under the Companies Act having its registered Office at Birlagram, Nagda, Madhya Pradesh. Samruddhi is primarily engaged in investment activities (as person acting in concert), Grasim and Samruddhi respectively hold 14.86% and 0.87% of the equity shares of the petitioner-company.

Pursuant to acquisitions through negotiated transactions, in the open market, an Open Offer made for the shares of the petitioner-company by Grasim, an unlisted company, as an acquirer with Samruddhi, a wholly owned subsidiary of Grasim, a proposal to demerge the (L T) demerged company's cement business was given by Grasim and after due deliberation, the Board of Directors of the demerged company accepted the proposal from Grasim for demerger of the cement business into the Resulting Company or CemCo by way of a Scheme of Arrangement under sections 391 to 394 of the Companies Act.

(E). L T Employees Welfare Foundation (for short "Trust") is an Employee Welfare Trust established under the Indian Trusts Act, 1882.

RELEVANT PROVISIONS :

3. The relevant provisions concern