Reverse flips rise as Indian startups tap Singapore’s Scheme: report

Singapore’s flexible corporate restructuring framework is allowing companies to reorganise operations efficiently.

Singapore’s Scheme of Arrangement is emerging as a crucial legal mechanism for Indian startups seeking to redomicile their parent companies back to India, according to Dentons Rodyk.

Amidst a wave of “reverse flips,” Singapore’s flexible corporate restructuring framework is allowing companies to reorganise operations efficiently whilst maintaining cross-border legal and regulatory compliance.

"In recent times, a number of Indian startups initially domiciled abroad, including some in Singapore, have undertaken a 'reverse flip' — a process of redomiciling their parent entities back to India," Dentons Rodyk noted.

This shift is driven by startups' aspirations to tap into India’s expanding capital markets and favourable regulatory environment, as well as strong investor confidence in India's growth prospects.

Rather than using a share swap, which could trigger capital gains tax for shareholders, companies are increasingly relying on Singapore’s Scheme of Arrangement to manage the transition.

Under the process, a Singapore-incorporated parent company transfers its entire undertaking, property, and liabilities to its Indian-incorporated subsidiary. Shareholders of the Singapore parent then receive shares in the Indian subsidiary, effectively completing the flip.

An application under section 210 of the Companies Act 1967 is made to the Singapore High Court for leave to convene a shareholder meeting to vote on the scheme. If approved, the Court’s sanction is sought to finalise the transaction.

Dentons Rodyk emphasised that the parties must demonstrate that the scheme is "commercially viable, feasible, fair, and reasonable" and in the interests of all stakeholders.

One of the Scheme’s advantages is its flexibility. "The Scheme of Arrangement process can be used in respect of foreign incorporated companies," Dentons Rodyk explained.

This makes it particularly useful for cross-border transactions, unlike Singapore’s amalgamation process, which applies only when both merging entities are Singapore-incorporated.

Section 210 of the Companies Act, read with the Insolvency, Restructuring and Dissolution Act 2018, allows a foreign company to use the Scheme if it has a "substantial connection" with Singapore, a crucial provision that has enabled this legal route to flourish.

Recent notable cases include Zepto and Pine Labs, both of which successfully completed reverse flips using the Singapore Scheme. Zepto’s January 2025 move "underscores Zepto's confidence in the liquidity and buoyancy of Indian capital markets," whilst Pine Labs’ transition similarly realigned its strategic focus.

Dentons Rodyk concluded that "the utilisation of Singapore's Scheme of Arrangement by Indian companies undertaking a reverse flip to India offers a flexible and efficient legal framework for complex cross-border reorganisations.”