Zahoor Sons Limited (‘ZSL’) is a public unlisted company engaged in the business of textile manufacturing. ZSL owns two factories. Due to the economic slow down, the textile industry has suffered badly and one of the factories of ZSL has been shut down for the past one year (‘Closed Factory’). During a recent meeting of the board of directors, the board was informed that the expensive machinery installed in the Closed Factory is depreciating rapidly. The board was also informed that a potential buyer has expressed his interest in buying the machinery, however, he wants to complete the sale before leaving for England in two weeks’ time. One of the directors was of the view that approval of the shareholders in a general meeting is needed for selling the machinery; and, in view of the 21-days minimum notice period for general meetings, their approval may not be available in time to complete the proposed sale.Required:With reference to the Companies Ordinance, 1984:
(a) advise the directors on whether approval of shareholders is needed for selling the machinery in the Closed Factory; and (5 marks)
