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Corporate restructuring

Unit: Company law

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Practice CPA Company law Corporate restructuring questions with detailed answers and explanations.

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April 2026

 1 Questions
Question 5
​​​​​(a) Explain THREE circumstances in which inspectors may be appointed to investigate the affairs of a company.   
 
(b) Analyse THREE advantages of corporate restructuring through a merger. 
 
(c) Agroline Ltd. is a private company limited by shares. Over the last two years, the company has suffered continuous financial losses and is unable to pay its debts as they fall due. Several creditors have served formal demands, but the company has failed to settle the amounts due. The creditors are now considering legal action against the company. 
 
Required: 
(i) With reference to Agroline Ltd., financial position distinguish between “administration” and 
“liquidation” as insolvency procedures that may be applied to the company.  
 
(ii) Explain TWO legal implications of a liquidation petition presented against the company by its creditors. 


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December 2025

 1 Questions
Question 6b
​​Summarise the legal procedures involved in the company amalgamation of a company under the Companies Act.


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August 2025

 1 Questions
Question 7b
​​Outline SIX strategies that public companies might use to manage employees concerns during a merger.


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April 2025

 1 Questions
Question 6c
​​In relation to corporate structuring, explain the following concepts:

(i) Mergers.

(ii) Compromises.

(iii) Arrangements.

(iv) Reconstructions.

(v) Amalgamations. 


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December 2024

 2 Questions
Question 1d
​​Describe the process of converting a private company to a public company.


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Question 6a
​​In relation to corporate restructuring, explain the following concepts:

(i) Legal restructuring.

(ii) Organisational restructuring.

(iii) Operational restructuring.

(iv) Financial restructuring.


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August 2024

 1 Questions
Question 6c
​​Analyse FOUR reasons for undertaking corporate restructuring.


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April 2024

 3 Questions
Question 7c
​​Identify SEVEN mechanisms that could be put in place to protect shareholders’ rights and interests during corporate restructuring.


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Question 2b
​​Identify SEVEN reasons why a company will effect a corporate restructuring.


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Question 1c
​​Examine SEVEN rules governing the alteration of company status in your country.


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August 2023

 1 Questions
Question 6a
​​In relation to corporate restructuring, explain the following terms: 

(i) Compromises.

(ii) Arrangements. 

(iii) Reconstructions. 

(iv) Takeovers.


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April 2023

 2 Questions
Question 7a
​​Highlight FIVE forms of corporate restructuring.


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Question 4d
​​Identify THREE ways in which the appointment of a Court appointed inspector may be terminated.


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December 2022

 1 Questions
Question 2b
​In relation to corporate restructuring: 

(i) Define amalgamation as a corporate restructuring strategy. 

(ii) Highlight THREE elements of corporate restructuring.


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August 2022

 1 Questions
Question 7b
​In the context of mergers and acquisitions: 

(i) Explain three types of takeovers. 

(ii) Highlight eight motives behind mergers. ​


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April 2022

 2 Questions
Question 3d
​​Explain five circumstances under which a company might decide to undergo corporate restructuring.


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Question 4a
​(i) In reference to mergers and acquisitions, explain the meaning of the term merger. 

(ii) In a take-over situation, the acquiring company is called the predator while the company being acquired is called a target. 

With reference to the above statement, discuss four methods which the predator might use to pay for the purchase price of the target company.


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Pilot December 2021

 1 Questions
Question 7
​​With respect to investigation of a company’s affairs and mergers: 

(a) Identify the court that has powers to appoint an inspector. 

(b) Describe six circumstances that might lead to such an appointment in (a) above. 

(c) Discuss the types of information that should be contained in the draft terms of scheme for a proposed merger


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December 2021

 2 Questions
Question 4c
​​ Describe four types of corporate restructuring.


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Question 4b
​​Identify two management areas of operation that might be affected by post-merger reorganisation.


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September 2021

 2 Questions
Question 5a
Outline four reasons why a company might undertake corporate restructuring.


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Question 5b
​​Distinguish between "external reconstruction" and "internal reconstruction".


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May 2021

 2 Questions
Question 7a
​​With reference to corporate restructuring:

(i) Describe four types of company mergers.

(ii) State three causes of internal reconstruction of a company.


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Question 6a
​​Enumerate six most common reasons why companies might want to reduce their capital.


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November 2020

 2 Questions
Question 1b
​​Summarise five ways in which a company might alter its share capital.


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Question 3a
​​ In relation to corporate restructuring: 

(i) Outline four merger documents which members of each of the merging companies are entitled to inspect. 

(ii) Explain three disadvantages of mergers of companies.


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November 2019

 1 Questions
Question 7b
​​ Summarise four strategies that a company might employ against hostile take-overs.


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May 2019

 1 Questions
Question 5a
​​ (i) Define the term "post merger re-organistion". 

(ii) Discuss four types of post merger re-organisation.


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November 2018

 2 Questions
Question 4a
​​Explain four rights of creditors in winding up proceedings.


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Question 4c
​​Outline six benefits of corporate restructuring to a company.


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May 2018

 2 Questions
Question 4a
​​ Define the following terms: 

(i) Reverse merger. 

(ii) Amalgamation.


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Question 4b
​​ Discuss four advantages of a reverse merger over the initial public offer (ІРO).


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November 2017

 2 Questions
Question 7c
​​​​ Identify six forms of corporate restructuring.


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Question 2a
​​ With reference to corporate restructuring, suggest five defence techniques that a targeted company might use to avoid a hostile takeover bid.


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May 2017

 2 Questions
Question 6b
​​Assume that you are the Management Accountant reporting to the Finance Director of a public limited company. The Finance Director recently undertook a financial review as part of the company's strategic review process. In his report, he observed that the company has more funds than are necessary to support its planned growth and that the company's capital should be reduced.

You are required to write a report outlining methods which might be adopted to reduce the capital of the company. 


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Question 6a
​​In the context of post-merger reorganisation:

(i) Define the term "post-merger integration".

(ii) Describe four types of post-merger integration.


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November 2016

 1 Questions
Question 5a
​​With reference to corporate restructuring, discuss five causes of failure of mergers and acquisitions.


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May 2016

 1 Questions
Question 1b
​​Sea Bubble Limited was amalgamated with Telta Limited to form Seashore Limited. Some employees of Sea Bubble Limited refused to be transferred to Seashore Limited alleging that Seashore Limited was an unstable company. Sea Bubble Limited insisted that the emplovees must join the service of Seashore Limited or be retrenched. 

Analyse the legal principles applicable in the above case and advise the employees of Sea Bubble Limited.


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November 2015

 1 Questions
Question 7b
​​Wanyoro Ltd. is a public company. Its directors have decided to venture into transport business by acquiring a fleet of public service vehicles. They did not notice that this activity is outside its objects clause. The company's chairman. Ann Omesa who owns 10% of the voting shares negotiated a loan which was in excess of the company's issued capital from Joan Mekonge, a financier. 

Joan Mekonge did not refer to any of the company's registered documents nor did she inquire into the purpose to which the money would be put. The money is used by the directors to pay part of the purchase price of the vehicles. The rest of the purchase price remains unpaid. Some members who hold a substantial amount of shares in Wanyoro Ltd. intend to move a resolution to insert into the memorandum, an object permitting the acquisition and use of the vehicles. One of the directors of Wanyoro Ltd. announces that if this is done, he will apply to court to have the new object clause quashed. 

Advise the directors of the company.


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Pilot September 2015

 2 Questions
Question 7a
​​In relation to corporate restructuring, explain the statutory provisions relating to schemes of arrangement and compromises.


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Question 4c
​​Outline three conditions to be fulfilled before the court can approve a reduction of capital of a company.


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