63 moons technologies appeals to shareholders ahead of merger hearing

Seeks unity among shareholders, accuses MCA of not checking data, merger order hearing on Sept 26

Barely four days ahead of the schedule hearing of the amalgamation of National Spot Exchange Ltd (NSEL) with its parent 63 moon technologies ltd (formerly Financial Technologies India Ltd or FTIL), FTIL has urged its 63,000 shareholders to stand united.

In first such instance in private companies, the Ministry of Corporate Affairs (MCA) under article 396 of the Companies Act had orders in February 2016 merger of NSEL with FTIL thereby, to make FTIL liable to pay investors' dues in the Rs 5,600 crore payment default at NSEL.

The MCA's order, however, was challenged by FTIL in the Bombay High Court. The final order issued by MCA on February 12, 2016 was stayed till September 26, 2016 when the Bombay High Court is scheduled to decide on the legality and validity of the final order issued by the MCA.

"63 moons is disappointed but not disheartened by the current situation it is facing. We have the utmost respect for the judiciary and are confident that truth will come out and justice will prevail. It is our urge to all our shareholders to stand united in solidarity for truth and justice against rumors spread by vested interest using media and social media," said 63 moons in an appeal to its shareholders filed on the Bombay Stock Exchange (BSE)

Elaborating on its arguments to the MCA, 63 moons said, "MCA claimed the 63 moons' shareholders' response as 'orchestrated' without verifying the genuineness of shareholders' objections. Therefore, the MCA's view is not conclusive but a mere conjecture."

Clarifying further, 63 moon said that a listed company requires a minimum 40-45 days for obtaining shareholders' nod through annual general meeting, postal ballot, extra-ordinary general meeting or e-voting for any matter concerning shareholders rights or the company. But, 63 moons was given only 30 days, the period adequately short to seek shareholders' right. The company, however, sought response from its shareholders spread across 26 states and 5 union territories and 12 countries including India.

By contrast, however, the MCA got extension in the one month deadline for passing its final merger order which came only after one year.

Around 99.5 per cent of shareholders voted against the merger while 0.45 per cent favoured the MCA's move.

All these responses of which hard copies and soft copies were provided to the MCA could have been verified with depositories including NSDL and CDSL during the entire 1 year period the MCA took for passing the final order, 63 moons appeal said.