Part 17A company's share capital
Chapter 7Share premiums
Relief from requirements as to share premiums
613Merger relief: meaning of 90% equity holding
(1)
The following provisions have effect to determine for the purposes of section 612 (merger relief) whether a company (“company A”) has secured at least a 90% equity holding in another company (“company B”) in pursuance of such an arrangement as is mentioned in subsection (1) of that section.
(2)
Company A has secured at least a 90% equity holding in company B if in consequence of an acquisition or cancellation of equity shares in company B (in pursuance of that arrangement) it holds equity shares in company B of an aggregate amount equal to 90% or more of the nominal value of that company's equity share capital.
(3)
For this purpose—
(a)
it is immaterial whether any of those shares were acquired in pursuance of the arrangement; and
(b)
shares in company B held by the company as treasury shares are excluded in determining the nominal value of company B's share capital.
(4)
Where the equity share capital of company B is divided into different classes of shares, company A is not regarded as having secured at least a 90% equity holding in company B unless the requirements of subsection (2) are met in relation to each of those classes of shares taken separately.
(5)
For the purposes of this section shares held by—
(a)
a company that is company A's holding company or subsidiary, or
(b)
a subsidiary of company A's holding company, or
(c)
its or their nominees,
are treated as held by company A.