, LML4806 ASSIGNMENT 2 SEMESTER 1 2026
DUE DATE: APRIL 2026
Question 1
1.1
Type of Transaction and Whether the Companies Are Regulated Companies
The transaction described constitutes a disposal of all or the greater part of the assets or
undertaking of a company in terms of section 112 of the Companies Act 71 of 2008.1 In this
scenario, Buffalo Haulage Ltd is transferring all its assets and liabilities to Mahamba
Logistics Ltd for consideration of R300 million, followed by its deregistration. This clearly
falls within the ambit of section 112, as it involves the disposal of the entirety of the
company’s business.
Additionally, the transaction resembles a scheme of arrangement as contemplated in
section 114 of the Companies Act,2 because it involves a structured arrangement between
the company and its shareholders whereby shareholders receive compensation (R10.00 per
share) and the company is subsequently deregistered. However, the dominant classification
remains a section 112 disposal, with section 114 potentially applicable depending on
procedural structuring.
Regarding whether the companies are regulated companies, section 117(1)(i) of the
Companies Act defines a regulated company as including:
a public company;
a state-owned company; or
1
Companies Act 71 of 2008 s 112.
2
Companies Act 71 of 2008 s 114.
DUE DATE: APRIL 2026
Question 1
1.1
Type of Transaction and Whether the Companies Are Regulated Companies
The transaction described constitutes a disposal of all or the greater part of the assets or
undertaking of a company in terms of section 112 of the Companies Act 71 of 2008.1 In this
scenario, Buffalo Haulage Ltd is transferring all its assets and liabilities to Mahamba
Logistics Ltd for consideration of R300 million, followed by its deregistration. This clearly
falls within the ambit of section 112, as it involves the disposal of the entirety of the
company’s business.
Additionally, the transaction resembles a scheme of arrangement as contemplated in
section 114 of the Companies Act,2 because it involves a structured arrangement between
the company and its shareholders whereby shareholders receive compensation (R10.00 per
share) and the company is subsequently deregistered. However, the dominant classification
remains a section 112 disposal, with section 114 potentially applicable depending on
procedural structuring.
Regarding whether the companies are regulated companies, section 117(1)(i) of the
Companies Act defines a regulated company as including:
a public company;
a state-owned company; or
1
Companies Act 71 of 2008 s 112.
2
Companies Act 71 of 2008 s 114.
