Ace Software Export's Limited proposes merger with no share change

Ace Software Export's Limited has proposed absorbing seven wholly owned subsidiaries without issuing shares, paying consideration or changing its shareholding structure; their combined FY 2025-26 turnover was Rs 39.0697 crore, against the listed parent’s Rs 14.5559 crore, based on financial statements as of March 31, 2026.

What has ASEL proposed?

ASEL has proposed a scheme of merger or amalgamation in which seven wholly owned subsidiaries would merge into the listed company. The transferor companies are Ace Infoway Private Limited, Ace InfoWorld Private Limited, QeCAD Studio Private Limited, QeNomy Digital Private Limited, QeMFG Private Limited, QeLearn Private Limited and QeApps Private Limited, while ASEL is the transferee company incorporated on August 17, 1994.

The filing places all eight entities in information technology and identifies the seven transferors as wholly owned subsidiaries of ASEL. Their combined disclosed FY 2025-26 turnover was Rs 39.0697 crore, exceeding ASEL’s standalone turnover of Rs 14.5559 crore for the year ended March 31, 2026. The scheme would cancel the equity shares held by ASEL and its nominee shareholders in the transferor companies when it becomes effective.

QeNomy Digital was the largest transferor by disclosed turnover at Rs 15.4975 crore, followed by Ace Infoway at Rs 13.2128 crore and QeCAD Studio at Rs 7.0377 crore. QeLearn reported Rs 1.2347 crore, while QeMFG reported Rs 94.78 lakh, QeApps reported Rs 95 lakh and Ace InfoWorld reported Rs 19 lakh. The disclosure states that QeCAD Studio’s and QeNomy Digital’s FY 2025-26 turnover includes the respective LLP and private limited company operations.

Will ASEL issue shares or pay cash for the merger?

ASEL will not issue shares, pay cash or provide any other consideration under the proposed scheme because the transferors are wholly owned subsidiaries. The company says no share-exchange ratio is required, and the existing subsidiary shares held by ASEL and its nominees would be cancelled upon the scheme becoming effective.

The filing also states that the scheme would not alter ASEL’s issued, subscribed or paid-up share capital, shareholding pattern, voting rights, promoter shareholding or public shareholding. This means the planned amalgamation differs from an acquisition from outside shareholders, where a cash payment or share consideration could be required.

The no-consideration merger is separate from the preferential issue disclosed elsewhere in the same filing. That proposal covers 4,52,146 ASEL equity shares at Rs 238 each, aggregating to Rs 10.7610748 crore, for consideration other than cash in connection with purchases of MUG and MUGC shares. Westbury Solutions Limited would hold 2.42% of ASEL’s equity share capital after that separate allotment.

Which operations would move into ASEL?

ASEL would absorb businesses spanning IT services, computer-aided design, digital services, software-as-a-service and education technology. Ace Infoway provides software development, data processing, data entry, internet services, computer-aided design, e-commerce and computer-aided online transaction processing, while Ace InfoWorld provides software development, consultancy and information and communication technology solutions.

QeCAD Studio provides drafting, mechanical and electrical planning, Building Information Modelling, shop drawings, detailing, rendering and walkthroughs for construction, infrastructure and engineering clients in the US and Australia. Its Rs 7.0377 crore FY 2025-26 turnover represents combined turnover of QeCAD Studio LLP and QeCAD Studio Private Limited, according to the filing’s note on the entity’s conversion effective August 18, 2026.

QeNomy Digital undertakes software exports, web development, digital marketing, e-commerce, e-retail, staffing and design activities. The filing says its Rs 15.4975 crore FY 2025-26 turnover represents combined turnover of QeNomy Digital LLP and QeNomy Digital Private Limited following conversion effective March 18, 2026. QeMFG develops software, web and mobile products, SaaS solutions, artificial intelligence, machine learning, data analytics and automation services.

QeLearn provides educational and skill-development services, digital learning applications and content through online, offline and hybrid formats, while QeApps develops, licenses, maintains and supports software products. These activities would join ASEL’s stated operations in software and application development, IT-enabled services, digital transformation, cloud and emerging technology solutions, engineering and design services, digital content, data processing, consultancy and staffing.

How do the transferors compare with ASEL’s reported figures?

The transferors’ Rs 39.0697 crore combined FY 2025-26 turnover was about 2.7 times ASEL’s Rs 14.5559 crore standalone turnover for the same year. The disclosure does not provide pro forma post-merger revenue, profit, net worth or earnings per share, so it does not quantify how the amalgamation would affect the listed company’s reported financial statements.

ASEL reported net worth of Rs 107.7057 crore as of March 31, 2026. Among the transferors, QeNomy Digital had disclosed net worth of Rs 24.8151 crore, Ace Infoway had Rs 9.1039 crore and QeCAD Studio had Rs 5.8819 crore; QeApps had net worth of Rs 3.19 lakh. The seven transferors’ figures cannot by themselves establish the merged company’s net worth because the filing does not disclose consolidation adjustments or intra-group eliminations.

For the six months ended September 30, 2026, ASEL reported revenue from operations of Rs 7.5634 crore, compared with Rs 6.8834 crore in the six months ended September 30, 2025. Profit for the period rose to Rs 1.7224 crore from Rs 1.3732 crore. In the September 2026 quarter, revenue from operations was Rs 2.0272 crore, compared with Rs 3.6281 crore in the September 2025 quarter.

What approvals and timetable does ASEL disclose?

ASEL says no approval under Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is required for the proposed merger. It cites Regulation 23(5)(a), which excludes specified related-party transaction provisions for transactions between a holding company and its wholly owned subsidiary.

The announcement does not disclose an appointed date, effective date, completion date, tribunal hearing date or timetable for other scheme approvals. It only states that the subsidiary shares held by ASEL and its nominee shareholders would stand cancelled when the scheme becomes effective. Accordingly, the filing does not establish when the seven businesses would legally transfer into ASEL.

Conclusion

ASEL’s proposed scheme would place seven wholly owned IT and technology-enabled businesses directly within the listed parent without merger consideration or a change in shareholder rights. The transferors’ disclosed FY 2025-26 turnover of Rs 39.0697 crore was higher than ASEL’s standalone Rs 14.5559 crore, led by QeNomy Digital, Ace Infoway and QeCAD Studio.

The next development to watch is a disclosure establishing when the scheme can become effective, because ASEL has not provided a timetable or identified further approval dates. Any later pro forma financial information would also be relevant, as the current filing does not state the post-merger revenue, profit, net worth or earnings per share of the combined operations.