Companies Act 2014 section 1127

Interpretation (Chapter 16)

Section 1127 defines the key terms used throughout Chapter 16, which deals with mergers of public limited companies, including the meanings of "company", "merger", "merging company", "transferor company", "successor company", and "share exchange ratio".

• A "merger" can take three forms: by acquisition, by absorption, or by formation of a new company, each as further defined in section 1129.
• "Company" is defined broadly to include not only registered companies but also unregistered bodies corporate, reflecting the wider scope of EU-derived merger rules.
• A "merging company" is any company involved in the merger — either as a transferor handing over its assets and liabilities or, in the case of an acquisition or absorption, the successor company receiving them.
• The "share exchange ratio" is the number of shares in the successor company to be allotted to members of a transferor company in exchange for a given number of their existing shares, as set out in the common draft terms of merger.