Registered Valuers u/s 247 of Companies Act, 2013 – Securities Or Financial Assets
What is Registered Valuer ?
Section 247 of the Companies Act, 2013 mandates that all valuations required under Act shall be carried out by Registered Valuers only. Similarly, as per Insolvency and Bankrupcy Code, only Registered Valuers shall be eligible to carry out the valuations. Insolvency & Bankrupcy Board of India (IBBI) shall be the Authority to grant licenses to act as Registered Valuers.
CA Anandkumar Gawade, Managing Partner of the Firm is IBBI Registered Valuer for Securities or Financial Assets Class. His Registration Number is IBBI/RV/05/2019/10746.
I also would like to bring to your notice circular of IBBI dated 17th October 2018 which mandates as under :
“In view of the above, every valuation required under the Code or any of the regulations made there under is required to be conducted by a ‘registered valuer’, that is, a valuer registered with the IBBI under the Companies (Registered Valuers and Valuation) Rules, 2017. It is hereby directed that with effect from 1st February, 2019, no insolvency professional shall appoint a person other than a registered valuer to conduct any valuation under the Code or any of the regulations made there under.”
Hence the Valuation Reports under Companies Act, 2013 after 1st Feb 2019 has to be obtained from Registered Valuers registered with IBBI only.
Usually Valuations reports are required for following:
a. Issue of Shares & Securities
b. Fair Value Determination as per IND-AS / IFRS
c. Valuation of Intangibles
d. Related Party Transactions
e. Issue of Shares for Non-cash consideration
f. Valuation of Goodwill and Intangibles.
g. Fairness opinion for Scheme of Amalgmation & Arrangement
h. ESOP Valuation
i. Valuations for special purposes such as disputes, exits, etc.
As per Companies Act 2013, following sections requires valuation from Registered Valuers in following areas:
|1||62(1)C||Valuation report for Further Issue of Shares||If any company proposes to issue new shares (except a rights issue to existing shareholders or to employees under employees stock options), the price of such shares should be determined by the valuation report of a Registered Valuer.|
|2||192(2)||Valuation of Assets Involved in Arrangement of Non cash transactions involving Directors||In case of sale or purchase of any asset involving a company and the directors of the company (or its holding, subsidiary or associate company) or a person connected with the Director for consideration other than cash, the value of the assets has to be calculated by a Registered Valuer.|
|3||230(2)(c)(v||Valuation of shares, property and assets of the Company under a scheme of Corporate Debt Restructuring||In case of a compromise or arrangement between members (such as in mergers or amalgamations) or with creditors (such as in corporate debt restructuring), a valuation report in respect of shares, property or assets, tangible and intangible, movable and immovable of the company, or a swap ratio report by a Registered Valuer is required.
In case of mergers, the directors are also required to circulate a report to members specifying, inter alia, any
|4||230(3)||Valuation report along with Notice of creditors/shareholders meeting –Under scheme of compromise/Arrangement||In case of a compromise or arrangement between members (such as in mergers or amalgamations) or with creditors, a valuation report in respect of shares, property or assets, tangible and intangible, movable and immovable of the company, or a swap ratio report by a Registered Valuer is required.|
|5||232(2(d)||The report of the expert with regard to valuation, if any, would be circulated for meeting of creditors/Members||Same as above|
|6||232(3)(h)||The Valuation report to be made by the tribunal for exit opportunity to the shareholders of transferor Company –Under the scheme of Compromise/Arrangement in case the Transferor company is Listed Company and the Transferee-company is an unlisted Company||Same as above|
|7||236(2)||Valuation of equity shares held by the Minority Share Holders||In case an acquirer or person acting in concert with the acquirer acquire 90% or more of the equity capital in a company, they can offer to the minority shareholder (or the minority shareholder can offer to the acquirer) to acquire the minority shareholding at a valuation determined by the Registered Valuer.|
|8||281(1)||Valuing assets for submission of report by liquidator||A valuation of assets of the company prepared by the Registered Valuer is required in case of winding up, voluntarily or otherwise.|