LML4806
ASSIGNMENT 2
DUE DATE: APRIL 2026
, LML4806
ASSIGNMENT 2
DUE APRIL 2026
Mahamba Logistics Ltd and Buffalo Haulage Ltd have concluded an agreement in terms of
which Mahamba Logistics Ltd will acquire and hold all the assets and liabilities of
Buffalo Haulage Ltd for R300 million (the ‘Transaction’). The material terms of the
Transaction include that Mahamba Logistics Ltd will pay the shareholders of Buffalo Haulage
Ltd a cash consideration of R10.00 for each Buffalo Haulage Ltd share held and that, pursuant
to the implementation of the Transaction, Buffalo Haulage Ltd will be deregistered.
QUESTION 1
Identify the type of transaction that is contemplated in the scenario above and explain
whether the companies that are involved in this transaction are regulated companies for
purposes of the Companies Act 71 of 2008.
In terms of the Companies Act 71 of 2008. The transaction between Mahamba Logistics Ltd and
Buffalo Haulage Ltd constitutes a fundamental transaction. Specifically, it amounts to a merger
or amalgamation as contemplated in section 113 of the Act, because Mahamba Logistics Ltd will
acquire all the assets and liabilities of Buffalo Haulage Ltd, after which Buffalo Haulage Ltd will
be deregistered and cease to exist.¹
A merger or amalgamation happens where two or more companies combine their businesses in
such a way that one company survives and the other is dissolved. Transactions of this nature
affect the core structure and existence of a company and therefore trigger the special
protections applicable to fundamental transactions under the Companies Act.²
ASSIGNMENT 2
DUE DATE: APRIL 2026
, LML4806
ASSIGNMENT 2
DUE APRIL 2026
Mahamba Logistics Ltd and Buffalo Haulage Ltd have concluded an agreement in terms of
which Mahamba Logistics Ltd will acquire and hold all the assets and liabilities of
Buffalo Haulage Ltd for R300 million (the ‘Transaction’). The material terms of the
Transaction include that Mahamba Logistics Ltd will pay the shareholders of Buffalo Haulage
Ltd a cash consideration of R10.00 for each Buffalo Haulage Ltd share held and that, pursuant
to the implementation of the Transaction, Buffalo Haulage Ltd will be deregistered.
QUESTION 1
Identify the type of transaction that is contemplated in the scenario above and explain
whether the companies that are involved in this transaction are regulated companies for
purposes of the Companies Act 71 of 2008.
In terms of the Companies Act 71 of 2008. The transaction between Mahamba Logistics Ltd and
Buffalo Haulage Ltd constitutes a fundamental transaction. Specifically, it amounts to a merger
or amalgamation as contemplated in section 113 of the Act, because Mahamba Logistics Ltd will
acquire all the assets and liabilities of Buffalo Haulage Ltd, after which Buffalo Haulage Ltd will
be deregistered and cease to exist.¹
A merger or amalgamation happens where two or more companies combine their businesses in
such a way that one company survives and the other is dissolved. Transactions of this nature
affect the core structure and existence of a company and therefore trigger the special
protections applicable to fundamental transactions under the Companies Act.²
