Scheme of reconstruction involving issue of shares or securities
6.—(1) The case described in this regulation is where—
(a)an arrangement between a company (“company A”) and—
(i)the persons holding shares in or securities of the company, or
(ii)where there are different classes of shares in or securities of the company, the persons holding any class of those shares or securities,
is entered into for the purposes of, or in connection with, a scheme of reconstruction,
(b)under the arrangement—
(i)another company (“company B”) issues shares or securities to those persons in respect of and in proportion to (or as nearly as may be in proportion to) their original holding, but
(ii)the shares in or securities of company A comprised in their original holding are either retained by those persons or cancelled, redeemed or otherwise extinguished,
(c)the person in question is a venture capital trust, and
(d)the new shares are issued in respect of old shares or old securities, and the new securities are issued solely in respect of old securities.
(2) In paragraph (1) and regulation 9—
(a)expressions (other than “securities”) have the same meanings as in section 136(1) and (3) to (5) of the 1992 Act(1) (references to “debentures” in those provisions being read as references to “securities” as defined above);
(b)the shares in or securities of company B issued to the trust company are referred to as the “new shares” and the “new securities” respectively, and the trust company’s original holding in company A is referred to, separately and as the case may be, as the “old shares” and the “old securities” respectively.
Section 136 was substituted by paragraph 2 of Schedule 9 to the Finance Act 2002.