Midwest Gold Ltd to Merge with Midwest Energy Private Limited in Scheme of Amalgamation

Midwest Gold Ltd to Merge with Midwest Energy Private Limited in Scheme of Amalgamation​

Midwest Gold Limited is undertaking an amalgamation with Midwest Energy Private Limited. The Merger, which involves Midwest Energy Private Limited merging into Midwest Gold Limited, has received confirmation approval from the Regional Director - South East Region, Ministry of Corporate Affairs.

The amalgamation is structured under Section 233 of the Companies Act, 2013. Consequently, Midwest Energy Private Limited will merge with its holding company, Midwest Gold Limited.

Transaction and Company Details​

Midwest Energy Private Limited, the Transferor Company, was incorporated on September 13, 2018, and is a Wholly Owned Subsidiary of Midwest Gold Limited. Midwest Gold Limited, the Transferee Company, was incorporated on November 20, 1990.

The operational details for the two entities are summarized below:

Business Scope and Rationale​

The amalgamation is based on the premise that the Transferor Company and the Transferee Company operate in complementary businesses. The business activities of the Transferor Company can be combined with the Transferee Company's business for greater convenience and advantage.

Midwest Gold Limited's primary business is mining and processing of minerals. Conversely, Midwest Energy Private Limited specializes in the design, development, and manufacturing of advanced battery packs and Battery Management Systems.

The rationale for the merger includes several factors:

• The Transferee Company's robust infrastructure base—including land, buildings, power, and water utilities—can efficiently support and expand the combined entity's operations, facilitating economies of scale and reducing resource duplication.
• The Transferee Company’s extensive legacy in mineral mining and processing can assist in the backward integration of key product lines from the Transferor Company, particularly concerning concentrates, rare earth materials, and energy materials.
• The merger is expected to improve the capital adequacy of the merged entity, enhancing its position for securing project funding through both equity and debt instruments, as the Transferor Company faces funding challenges due to the capital-intensive nature of its projects.
• Furthermore, integration with the listed Transferee Company is anticipated to make the investment structure more appealing to Venture Capitalists and other funding agencies.

Capital Structure and Shareholding​

Since Midwest Energy Private Limited is a wholly owned subsidiary of Midwest Gold Limited, the amalgamation will not result in any shares being issued as consideration to any person. Consequently, there will be no change in the shareholding pattern of Midwest Gold Limited due to the merger.

The authorized, issued, subscribed, and paid-up share capital for the companies as of April 1, 2025, was:

Key Outcomes of the Scheme​

Upon the completion of the Scheme, several structural and operational changes are anticipated:

• Name Change: The name of the Transferee Company is set to be changed to "MIDWEST ENERGY LIMITED" following the sanction and registration of the requisite forms.
• Object Clause Amendment: The main objects of the Transferor Company will be added to the Memorandum of Association of Midwest Gold Limited, ensuring business continuity and allowing the Transferee Company to expand the transferred business more efficiently.
• Asset and Liability Transfer: All assets and liabilities of Midwest Energy Private Limited will vest in Midwest Gold Limited. This includes all movable and immovable properties, fixed assets, current assets, outstanding loans, and intellectual property rights.
• Legal and Tax Status: All legal proceedings, contracts, and tax liabilities concerning the Transferor Company will continue under the Transferee Company, ensuring continuity of operations.

The scheme is contingent upon the approval by the requisite majority of Shareholders and Creditors of both the Transferee Company and the Transferor Company, and the final sanction by the Regional Director, South East Region, Hyderabad, or the NCLT, Hyderabad Bench.

Stock Price Movement​

At the close of trade on Monday, Midwest Gold Ltd settled at ₹4445.15, shedding 5.00% for the day. Throughout trading, the shares drifted downward, fluctuating within a range between ₹4445.15 and a high of ₹4545.00.

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