a)
Principle
There are two methods of merger. Companies may merge through an acquisition of one company by another one (merger by acquisition) or merger in a new company (merger by formation of a new company).
In the application of the merger related provisions of this law the acquiring company is referred to as "transferee” and the acquired company is referred to as "transferred”.
The merger is formed through the automatic acquisition of the company shares of the transferee by the shareholders of the acquired company in exchange for the company assets of the transferee in accordance with an exchange ratio.
In the merger transaction the transferee company takes over the assets of the transferred company as a whole. As a result of the merger the transferred company is dissolved and removed from the trade registry.
b) Applicable mergers
In accordance with the new TCC, applicable merger types are as follows:
- Capital stock companies may merge with cooperatives and general partnerships and limited partnerships (in the case they are the transferee company) and capital stock companies.
- Personal companies may merge with capital stock companies and cooperatives (in the case they are the transferred company) and personal companies.
- Cooperatives may merge with personal companies (in the case they are the transferee company) and cooperatives and capital stock companies.
c) Participation of a liquidating company in a merger
A liquidating company may participate in a merger in cases where the assets of the company have not yet been distributed and it is the transferred company. The compliance with these conditions should be proven with the relevant documentations to the Trade Registry Directorate at the location of the head office of the transferee company.
d) Participation to a merger in the case of capital loss or excess of
liabilities over assets
A company which lost the capital and the half of its total legal reserves with losses or which is in a situation where the liabilities exceed its assets may enter into a merger with a company which has adequate equity to cover the former's capital loss or (if necessary) excess liabilities over assets. The compliance with these conditions should be proven with the relevant documentations to the trade registry directorate at the location of the head office of the transferee company.
