Semac Construction Limited Approves Merger with Wholly-Owned Subsidiary

Semac Construction Limited (SCL) has announced a significant corporate restructuring move, approving a scheme of amalgamation to merge its wholly-owned subsidiary, Semac Construction Technologies India Private Limited (SCTPL), into itself. The Board of Directors gave the green light to this strategic decision, which aims to streamline operations and enhance efficiency within the group.

Key Details of the Merger

• Effective Date: The merger is set to take effect from July 1, 2025, subject to necessary regulatory approvals, including consent from the National Company Law Tribunal.
• Company Profiles:
  • SCTPL: Engaged in the construction of buildings, with a paid-up capital of ₹1.00 lakh and a negative net worth of ₹13.91 lakh.
  • SCL: The parent company, with a paid-up capital of ₹31.17 crore and a net worth of ₹6,490.87 lakh.

Financial Implications

No new shares will be issued as consideration for the merger, as SCTPL is already a wholly-owned subsidiary of Semac Construction Limited. This decision ensures that the shareholding pattern of SCL remains unchanged post-merger.

Rationale Behind the Merger

The amalgamation is driven by several strategic objectives:

1. Reduction in regulatory compliances
2. Simplification of the group structure
3. Ease of management
4. Reduction of administrative overheads

Business Operations

SCTPL

Primarily focused on the construction of buildings on an own-account basis or through fee/contract arrangements.

SCL

Offers a comprehensive range of services including:

• Design engineering consulting across various domains such as:
  • Architecture
  • Structural engineering
  • Electrical systems
  • Public health engineering
  • Fire protection
  • HVAC
  • LEED certifications
  • Energy audits
• Build services encompassing:
  • Detailed engineering
  • Procurement
  • Civil construction
  • Various installation services

Corporate Governance

The Board meeting that approved this merger was held on July 30, 2025, commencing at 10:00 A.M. and concluding at 03:00 P.M. During this meeting, the Board also approved:

1. Unaudited Financial Statements (Standalone and Consolidated) for the quarter ended June 30, 2025.
2. Reports from the Statutory Auditors, Messrs. S S Kothari Mehta and Company, on the financial results.
3. Convening of the 48th Annual General Meeting on September 12, 2025, at the company's registered office in Coimbatore.

Regulatory Compliance

The company has affirmed that the merger falls under related party transactions. However, it has been clarified that such transactions arising from compromises, arrangements, and amalgamations under specific provisions of the Companies Act, 2013, are exempt from related party transaction regulations as per Ministry of Corporate Affairs and SEBI guidelines.

This strategic move by Semac Construction Limited is expected to optimize resource utilization and streamline operations, potentially leading to improved operational efficiency and reduced costs for the combined entity.