Lloyds Engineering Works has received formal board approval for its strategic merger scheme involving the absorption of three group companies. The board of directors approved the scheme of merger by absorption on December 29, following regulatory disclosure requirements under SEBI Listing Regulations. The merger transforms the company from a premium equipment manufacturer into a complete engineering and infrastructure solutions provider.

Board Approval and Regulatory Disclosure

The company's board has formally approved the merger by absorption of Lloyds Infrastructure & Construction Limited (LICL), Metalfab Hightech Private Limited (MHPL), and Techno Industries Private Limited (TIPL) with Lloyds Engineering Works Limited as the absorbing entity. The scheme has been approved pursuant to Sections 230 to 232 and other applicable provisions of the Companies Act, 2013.

Company Details and Business Operations

The merger involves companies with complementary business operations across the engineering and infrastructure value chain. LICL, incorporated in April 2023, specializes in construction activities including road infrastructure, bridge infrastructure, railway infrastructure, and industrial civil work under various models including BOOT, BOO, BOLT, and PPP arrangements.

Financial Performance and Combined Strength

The merger consolidates substantial financial strength across all entities based on performance for the year ended September 30. The combined entity demonstrates strong operational metrics with significant order book value and robust profitability across most business segments.

Share Exchange Ratios and Shareholding Changes

The merger implements specific share exchange ratios for shareholders of the absorbed companies. LICL shareholders will receive 1,798 LEWL shares for every 1,500 LICL shares held, while MHPL shareholders will receive 94 LEWL shares for every 5 MHPL shares. No additional shares will be issued for TIPL as LEWL is the sole shareholder.

Strategic Rationale and Operational Benefits

The merger creates a unified engineering and infrastructure company with enhanced capabilities across the entire industrial value chain. The combined entity will leverage LICL's robust order book of over ₹4,500 crore and proven project execution capabilities, thereby expanding operational scale and enhancing competitiveness in bidding for larger, multidisciplinary contracts. The integration eliminates operational silos and enables cost synergies through reduced administrative expenses and optimized resource allocation.

Regulatory Approvals and Next Steps

The scheme requires approval from the National Company Law Tribunal (NCLT), Competition Commission of India (CCI), and other competent authorities. The transaction qualifies as a related party transaction conducted on an arm's length basis, with professional valuation and fairness opinion obtained. However, under MCA General Circular No. 30/2014, transactions arising from amalgamations under the Companies Act will not attract Section 188 requirements.

Lloyds Engineering Works Limited has announced a significant employee stock option grant to strengthen its associate company operations. The company's Nomination and Remuneration Committee (NRC) approved the allocation of stock options on December 26, 2025, marking an important milestone in employee incentivization across the group.

ESOP Grant Details

The NRC approved the grant of 11,55,074 employee stock options to employees of Lloyds Infrastructure Construction Limited, an associate company. These options fall under the Lloyds Steels Industries Limited Employee Stock Option Plan-2021, which has received in-principle approval from both BSE Limited and National Stock Exchange of India Limited.

Vesting and Exercise Terms

The granted options come with specific vesting and exercise conditions designed to align employee interests with long-term company performance. The vesting schedule provides flexibility while ensuring sustained employee engagement.

Financial Impact

The ESOP grant represents a substantial financial commitment and potential value creation for the company. Upon full exercise of all granted options, the company stands to realize significant proceeds.

The key financial metrics include:

• Total shares covered: 11,55,074 equity shares upon exercise
• Potential money realization: ₹1.09 crores if all options are exercised
• Share conversion: Each option converts to one equity share of the company

Regulatory Compliance

The ESOP grant complies with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended from time to time. The company has fulfilled all disclosure requirements under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and SEBI Master Circular dated November 11, 2024.

This ESOP grant demonstrates Lloyds Engineering Works' commitment to employee retention and motivation across its associate companies, potentially enhancing operational synergies within the group structure.