LML4806
Assignment 2
Semester 1
Due April 2026
, LML4806 Assignment 2 Semester 1 2026
Scenario: Mahamba Logistics Ltd acquires all assets and liabilities of Buffalo Haulage
Ltd for R300 million. Shareholders of Buffalo Haulage Ltd approve 84% of the
resolution, while 16% dissent. Both companies are public companies.
Q1: May the dissenting shareholders of Buffalo Haulage Ltd seek court
intervention to stop the implementation of the transaction?
Answer
1.1 Introduction The proposed transaction is an acquisition of all assets and liabilities
of Buffalo Haulage Ltd by Mahamba Logistics Ltd. Under South African company law,
this is classified as a merger or “scheme of arrangement” type transaction, often
referred to as an amalgamation (Companies Act 71 of 2008, sections 112–114).
Shareholders who oppose such a transaction have statutory remedies, including
applying to court to restrain or challenge the transaction if they believe it is unfair or
prejudicial.
1.2 Identification of the type of transaction Section 114 of the Companies Act 71 of
2008 defines a merger or amalgamation as a transaction where:
• One or more companies transfer all or part of their assets and liabilities to
another company, and
• The transferring company may either be deregistered or continue as a
subsidiary.
Application to the facts:
• Buffalo Haulage Ltd transfers all assets and liabilities to Mahamba Logistics Ltd.
• Buffalo Haulage Ltd will be deregistered following the transaction.
Assignment 2
Semester 1
Due April 2026
, LML4806 Assignment 2 Semester 1 2026
Scenario: Mahamba Logistics Ltd acquires all assets and liabilities of Buffalo Haulage
Ltd for R300 million. Shareholders of Buffalo Haulage Ltd approve 84% of the
resolution, while 16% dissent. Both companies are public companies.
Q1: May the dissenting shareholders of Buffalo Haulage Ltd seek court
intervention to stop the implementation of the transaction?
Answer
1.1 Introduction The proposed transaction is an acquisition of all assets and liabilities
of Buffalo Haulage Ltd by Mahamba Logistics Ltd. Under South African company law,
this is classified as a merger or “scheme of arrangement” type transaction, often
referred to as an amalgamation (Companies Act 71 of 2008, sections 112–114).
Shareholders who oppose such a transaction have statutory remedies, including
applying to court to restrain or challenge the transaction if they believe it is unfair or
prejudicial.
1.2 Identification of the type of transaction Section 114 of the Companies Act 71 of
2008 defines a merger or amalgamation as a transaction where:
• One or more companies transfer all or part of their assets and liabilities to
another company, and
• The transferring company may either be deregistered or continue as a
subsidiary.
Application to the facts:
• Buffalo Haulage Ltd transfers all assets and liabilities to Mahamba Logistics Ltd.
• Buffalo Haulage Ltd will be deregistered following the transaction.
