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.webp "Extraordinary General Meeting")
An Extraordinary General Meeting (EGM) refers to a shareholder meeting convened outside a company’s regular Annual General Meeting cycle. It is typically called when matters requiring shareholder approval arise between annual meetings.
An Extraordinary General Meeting is a formally convened meeting of shareholders held to consider specific business matters that cannot wait until the next Annual General Meeting.
An EGM may be convened when corporate actions, governance changes, or regulatory requirements arise during the financial year and require shareholder approval.
Examples include: approval of mergers, changes in share capital, amendments to constitutional documents, or appointment or removal of directors.
Unlike routine annual meetings, EGMs are called for non-recurring matters that arise outside the standard reporting cycle.
EGMs are convened to place specific matters requiring shareholder approval before members between Annual General Meetings.
Common purposes can be grouped as follows:
Mergers, amalgamations, acquisitions, or takeovers
Sale or transfer of substantial business undertakings
Rights issues, bonus issues, share buybacks, or stock splits
Alterations to authorised share capital
Debt restructuring requiring shareholder consent
Appointment or removal of directors
Amendments to the Articles of Association
Changes in board composition requiring shareholder resolutions
Shifting of registered office between states
Actions arising from regulatory directions or statutory compliance requirements
Voluntary winding up, where applicable
These matters typically require formal shareholder resolutions, with urgency and statutory approval acting as the common drivers for convening an EGM.
Under the Companies Act, 2013, EGMs follow a defined statutory framework. Statutory requirements typically cover:
Issuance of a notice specifying date, time, place (or electronic mode), and business to be transacted
Minimum notice period of 21 clear days, unless consent for shorter notice is obtained as prescribed
Presence of quorum as defined under the Act or company articles
Consideration only of items listed in the meeting notice
Passing of ordinary or special resolutions based on the nature of the business
Recording of proceedings through formal meeting minutes
An Extraordinary General Meeting may be convened by:
Board of Directors, through a board resolution
Requisitioning shareholders, holding at least one-tenth of paid-up share capital carrying voting rights
National Company Law Tribunal (NCLT), in specific circumstances where statutory provisions are invoked
A listed company receives a merger proposal requiring shareholder approval. Since the matter arises mid-year, the board convenes an EGM to place the proposal before shareholders.
Agenda items may include:
Approval of the merger scheme
Appointment of additional directors, if required
Alterations to shareholding structure
| Feature | EGM | AGM |
|---|---|---|
Purpose |
Specific non-routine matters |
Statutory annual business |
Timing |
As required |
Once every financial year |
Scope of agenda |
Limited to notified items |
Includes financial statements, dividends, director appointments |
Authority to convene |
Board, shareholders, or NCLT |
Board of directors |
Typical matters |
Mergers, capital changes, governance actions |
Accounts adoption, auditor appointment |
Extraordinary General Meetings form part of India’s corporate governance framework by facilitating formal shareholder consideration of business matters that arise outside the annual reporting cycle. Through a defined legal process, EGMs provide a formal channel for approving non-routine corporate actions as they occur.
This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.
An EGM may be called by the board of directors, eligible shareholders holding the prescribed voting rights, or the National Company Law Tribunal in specified situations.
Companies are generally required to provide at least 21 clear days’ notice, unless a shorter notice is permitted in accordance with statutory provisions.
Quorum requirements depend on the company’s membership size and are governed by the Companies Act, 2013, or the company’s Articles of Association.
EGMs address specific matters such as mergers, capital restructuring, governance changes, or regulatory approvals that arise outside the Annual General Meeting cycle.
Yes. Indian company law permits EGMs to be conducted through electronic means, subject to compliance with Ministry of Corporate Affairs guidelines.
An EGM is convened as needed for specific matters, while an AGM is a mandatory annual meeting covering routine statutory business.
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