NCLT Halts Changes To Throttle Aerospace’s Shareholding Amidst RattanIndia Dispute
The National Company Law Tribunal (NCLT) has halted RattanIndia Enterprises from making any changes to the shareholding of Throttle Aerospace Systems, a company that it acquired in 2021. The order came in response to a petition filed by Avio Aero International, an Italian aerospace company that held a 26% stake in Throttle Aerospace before it was acquired by RattanIndia.
Avio Aero alleged that RattanIndia had violated the terms of the acquisition agreement by issuing new shares in Throttle Aerospace without its consent. The company also alleged that RattanIndia had tried to dilute its shareholding in Throttle Aerospace.
In its order, the NCLT directed RattanIndia to maintain the status quo in respect of Throttle Aerospace’s shareholding. The tribunal also directed RattanIndia to file a reply to Avio Aero’s petition within two weeks.
The dispute between RattanIndia and Avio Aero has its roots in the acquisition of Throttle Aerospace by RattanIndia in 2021. The acquisition agreement stipulated that RattanIndia would issue new shares in Throttle Aerospace to Avio Aero, which would increase its stake to 49%. However, RattanIndia has so far not issued these new shares.
Avio Aero has alleged that RattanIndia is deliberately delaying the issuance of new shares in order to dilute its stake in Throttle Aerospace. The company has also alleged that RattanIndia is trying to take control of Throttle Aerospace without its consent.
RattanIndia, on the other hand, has denied all of Avio Aero’s allegations. The company has claimed that the delay in issuing new shares to Avio Aero is due to technical reasons. RattanIndia has also claimed that it has no intention of diluting Avio Aero’s stake in Throttle Aerospace.
The dispute between RattanIndia and Avio Aero is a complex one, and it is likely to take some time to resolve. However, the NCLT’s order halting any changes to Throttle Aerospace’s shareholding is a significant victory for Avio Aero. The order prevents RattanIndia from taking any further steps to dilute Avio Aero’s stake in the company.
The outcome of this dispute will have a significant impact on the future of Throttle Aerospace. If Avio Aero is successful in its petition, it could lead to RattanIndia being forced to sell its stake in Throttle Aerospace. This would open up the possibility of other companies acquiring Throttle Aerospace.
Implications of the NCLT order
The NCLT order has several implications for both RattanIndia and Avio Aero.
For RattanIndia, the order means that it cannot proceed with its plans to take full control of Throttle Aerospace. The company will have to maintain the status quo in respect of Throttle Aerospace’s shareholding until the NCLT resolves the dispute. This could delay RattanIndia’s plans for Throttle Aerospace and could also lead to financial losses for the company.
For Avio Aero, the order is a positive development. The order prevents RattanIndia from diluting Avio Aero’s stake in Throttle Aerospace. This means that Avio Aero will retain its stake in the company and will continue to have a say in its operations. The order could also lead to Avio Aero increasing its stake in Throttle Aerospace in the future.
Conclusion
The NCLT order is a significant development in the dispute between RattanIndia and Avio Aero. The order prevents RattanIndia from making any changes to Throttle Aerospace’s shareholding until the tribunal resolves the dispute. This is a positive development for Avio Aero, as it prevents RattanIndia from diluting its stake in the company. The outcome of the dispute is likely to have a significant impact on the future of Throttle Aerospace.
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