CORPORATIONS--MERGER--STATUTORY MEANING OF "SAME OR SIMILAR PURPOSES"

Authors

Ray A. McIntyre, University of Michigan Law School

Abstract

A merger agreement was drawn up and approved by the necessary statutory majority of shareholders for the merging of a corporation engaged in making and selling razor blades into one which was making and selling pens and pencils; but the minority stockholders of the razor blade company sought a preliminary injunction against the merger on the grounds that it was prohibited by the statute which confines the authority to merge to those corporations which are organized ". . . for the purpose of carrying on any kind of business of the same or similar nature . . . . " The certificates of incorporation of both companies provide that one of the purposes is "to manufacture, purchase or otherwise acquire . . . deal in and deal with, goods, war.es and merchandise and real and personal property of every description . . . " Held, the merger is prohibited, for the principal objects of the two companies are dissimilar and the common language in the certificates is too general and illusory to remedy it. Imperial Trust Co. v. Magazine Repeating Razor Co., (New Jersey Chancery 1946) 46 A. (2d) 449.

Recommended Citation

Ray A. McIntyre, CORPORATIONS--MERGER--STATUTORY MEANING OF "SAME OR SIMILAR PURPOSES", 45 Mich. L. Rev. 214 (1946).
Available at: https://repository.law.umich.edu/mlr/vol45/iss2/11