The FMCG company informed that the Mumbai bench of the National Company Law Tribunal (NCLT) has sanctioned the scheme of amalgamation of Jyothy Fabricare Services with Jyothy Labs.
"The scheme will come into effect upon filing of the certified copy of the National Company Law Tribunal, Mumbai Bench with the Registrar of Companies by the transferor company and the transferee company, Jyothy Labs said in a statement.
In September last year, the board of Jyothy Labs had approved a scheme of amalgamation for amalgamation of its wholly owned subsidiary viz. Jyothy Fabricare Services (transferor company) with Jyothy Labs (the transferee company), subject to necessary approvals.
Stating the rationale for the said amalgamation scheme, Jyothy Labs said Jyothy Fabricare Services is in the business of laundry and dry-cleaning services.
"Since both the companies are operating in complementary/similar line of business, the same can be conveniently combined for mutual benefit and can be carried out more efficiently as one amalgamated entity.
The proposed amalgamation will help pool and combine finances and resources into one consolidated entity which will result in administrative and operations rationalization, organization efficiencies, optimal utilization of various resources, overheads and other expenses and better compliance management
The proposed amalgamation will help the Transferee Company to achieve financial strength and flexibility aiding in achieving economies of scale, more focused operational efforts, standardization and simplification of business processes and productivity improvements.
The synergies created by the amalgamation would increase operational efficiency and integrate business functions, Jyothy Labs had said in a statement.
Jyothy Labs is principally engaged in manufacturing and marketing of fabric care, dishwashing, personal care and household insecticides products.
The company's consolidated net profit rose 75.36% to Rs 67.39 crore on a 13.66% rise in sales to Rs 612.67 crore in Q3 FY23 over Q3 FY22.
The scrip fell 2.21% to currently trade at Rs 186.25 on the BSE.
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