Mumbai: The Mumbai Bench of the National Company Law Tribunal (NCLT) has sanctioned a Composite Scheme of Arrangement between Aditya Birla New Age Hospitality Private Limited (ABNAH) and KA Hospitality Private Limited (KAH) and their respective shareholders.

The order, delivered on June 18, 2025, approved the demerger of ABNAH's Demerged Undertaking into KAH. The scheme, as mentioned in the NCLT’s order copy, specifies that it aims to consolidate the hospitality businesses of both companies.

Aditya Birla New Age Hospitality Private Limited, the Demerged Company, is involved in owning and operating "Club Jolies" in Worli, Mumbai, and premium restaurants through its subsidiaries, in addition to venture investments. KA Hospitality Private Limited, the Resulting Company, is primarily engaged in owning and operating premium restaurants, including Hakkasan, Yauatcha, CINCIN, and Nara.

The rationale behind the scheme stems from ABNAH's recent acquisition of 100% equity shares of KAH, making KAH a wholly-owned subsidiary. Recognizing their engagement in the same business, the management sought to demerge the Demerged Undertaking to KAH to leverage combined strengths and achieve potential commercial and operational synergies.

“Key benefits highlighted in the scheme include:

1) Consolidation and enhanced efficiency of Hospitality Businesses.

2) Strengthening of businesses by pooling resources.

3) Rationalization of management structure, reduction of overhead costs, and streamlining of operations for better economies of scale and cost savings.

4) Increased flexibility for future business activities, funding expansion, improving profitability, and strengthening KAH's balance sheet.

5) Higher flexibility to evaluate independent business opportunities and attract investors and strategic partners,” reads the order.

The NCLT noted that no objections were raised against the scheme. Meetings of equity shareholders, preference shareholders, secured creditors, and unsecured compulsorily convertible debenture holders of the Petitioner Companies were dispensed with due to consent affidavits received from all stakeholders.” Notices were issued to unsecured creditors, and the Petitioner Companies affirmed that the scheme would not affect their rights and payments would be made in the ordinary course of business.”

“As part of the demerger, KAH will issue and allot new equity shares and non-convertible redeemable preference shares (NCRPS) to ABNAH shareholders, “maintained the order copy.

The NCLT confirmed that the scheme appears fair and reasonable, does not violate any legal provisions, and is not contrary to public policy.