High Court approves two Walton tech firms merger

The High Court has approved the merger of non-listed Walton Digi-Tech Industries Ltd with listed Walton Hi-Tech Industries Ltd, paving the way for the group's strategic corporate restructuring.

Walton said in a price-sensitive information (PSI) disclosure that it received the formal judgment and order dated 29 July. Under the approved scheme, Walton Digi-Tech will be the transferor company and Walton Hi-Tech the transferee company.

The merger is expected to strengthen Walton Hi-Tech's business portfolio through vertical integration, adding products such as laptops, desktop PCs, printers, mobile phones, printed circuit boards (PCBs), IT accessories and electric bikes.

Infographic: TBS

According to Walton, the merger will generate cost and operational efficiencies, technological and innovation synergies, expand its market reach and strengthen its competitive position.

The board of Walton Hi-Tech endorsed a memorandum of understanding on the proposed merger in September last year under the relevant provisions of the Companies Act, 1994.

Walton Digi-Tech, which has been operating for more than eight years, is a Bangladeshi technology company offering more than 123 products across multiple segments under 36 brands, according to the disclosure.

Its audited financial statements for the year ended 30 June showed paid-up capital of Tk30 crore, revenue of Tk1,015.91 crore and net profit after tax of Tk18.14 crore.

At an extraordinary general meeting held in June, Walton Hi-Tech approved a share exchange ratio of one Walton Hi-Tech share for every 38.45 shares of Walton Digi-Tech. Accordingly, 7,80,234 Walton Hi-Tech shares will be issued against the three crore shares of Walton Digi-Tech.

The Bangladesh Securities and Exchange Commission (BSEC) issued its no-objection certificate for the proposed merger in March this year.