GB Global Limited, formerly known as Mandhana Industries Limited, has announced a significant corporate move with the approval of a merger with Dev Land & Housing Private Limited (DLH). This decision, taken at the Board meeting held on December 4, 2024, is a major step toward consolidating the operations of both companies. The merger will be conducted under the provisions of Sections 230 to 233 of the Companies Act, 2013, and requires the sanction of the National Company Law Tribunal (NCLT), Mumbai Bench, as well as approvals from Securities and Exchange Board of India (SEBI), stock exchanges, and other necessary regulatory authorities.

Rationale Behind the Merger

The merger has been initiated with a clear goal in mind: to streamline operations, reduce administrative costs, and create a more efficient business structure. The management of both companies believes that consolidation of businesses will lead to several operational advantages, including reducing the number of entities within the group. This strategic move is aimed at reducing regulatory compliance burdens and creating a more manageable organizational structure. Furthermore, the synergies from consolidation are expected to offer significant cost-saving benefits, allowing the companies to focus on growth and scalability in their respective sectors.

As of March 31, 2024, the companies involved reported strong financials. Dev Land & Housing Private Limited (DLH), primarily involved in infrastructure and real estate business, reported a turnover of ₹2,19,29,93,000. On the other hand, GB Global Limited, engaged in textile manufacturing and real estate, had a turnover of ₹83,37,50,851. The combined strength of both companies is expected to generate enhanced value for stakeholders. The paid-up capital of the two entities also reflects their operational scale, with DLH having ₹19,30,88,000 and GB Global at ₹50,03,31,430.

Strategic Benefits of the Merger

The merger is expected to bring about several key benefits, including:

• Consolidation of businesses to improve operational efficiency.
• Streamlining the business structure, which will make management easier and reduce operational complexity.
• Reduction of regulatory compliances, allowing both companies to focus more on growth and expansion.
• Leveraging the synergies between the two businesses to cut down on operating and administrative costs.
  
  

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With the merger of these two companies, the combined entity is poised to benefit from operational synergies, leading to lower costs and better resource utilization.

The area of business for both companies plays a significant role in this strategic move. DLH’s focus on infrastructure and real estate development complements GB Global’s textile manufacturing and real estate activities, making the merger a natural fit. With this merger, GB Global is now positioned to leverage the strengths of both companies, creating a diversified and robust platform for growth.

Next Steps and Approval Process

The merger is subject to the approval of shareholders and creditors, and the process will also involve receiving approval from the NCLT, which will review the transaction and ensure it is in compliance with all legal and regulatory requirements. SEBI and the stock exchanges will also play a role in ensuring that the merger adheres to all necessary guidelines.

Conclusion

This merger is expected to significantly enhance the competitive edge of both companies, enabling them to scale operations, reduce costs, and strengthen their market position. It represents a key strategic move in line with the growing trend of consolidation within the Indian business landscape.

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