1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.
Dismiss Notice
Have you checked if your business appears in our directory? Add your basic information for FREE!

Click Here to know more!!

If you would like links to source leads, upgrade from £12.50 a month!

Click Here to subscribe!
Dismiss Notice

Hi Guest!

Our website stays online because of the support of our advertisers. A huge part of them are from banner ads that appear on our site. While some of them seems to be intrusive for some, these ads are needed to keep our community running and continue providing free membership service for buyers.

In light to this, we request that you disable ad blocking programs or add our website to your ad blocker's whitelist. This keeps us from offering our basic membership to everyone for free and help with maintenance costs of our website.

If you have already disabled ad blocking programs or added us into the whitelist, please ignore this message, this message will disappear in a few seconds!

Re-registering a private limited company to a public limited company

Discussion in 'Legal, Insurance, Employment and Health & Safety' started by VladimirsHromakovs, Feb 14, 2018.

  1. VladimirsHromakovs

    VladimirsHromakovs

    Joined:
    Feb 14, 2018
    Messages:
    2
    Hello,

    I am going to register a private limited company and get the investment for 20% of my shares. When the assets grow I am going to re-register my company to a public limited company.

    How can I do that? What actions do I need to take?

    One of the ways I think is to register a fresh public limited company and buy all the shares from the first company. But what to do with the investors who already have 20% of the first company?

    Thank you,
    Vladimir.
  2. CL102

    CL102

    Joined:
    Oct 11, 2015
    Messages:
    15
    The fresh PLC would pay all the shareholders to buy their shares out. Fresh PLC can pay in cash or pay in its own shares. The 20% shareholders will get 20% of the cash or shares being issued by Fresh PLC. I'm sorry I don't quite understand your question.

    When you own 80% of the shares of the LTD company and others own 20%...it's a simple enough structure. It doesn't get simpler than that. When the LTD is bought (or liquidated) you get 80% and they get 20%. Isn't that obvious or am I missing something?
  3. VladimirsHromakovs

    VladimirsHromakovs

    Joined:
    Feb 14, 2018
    Messages:
    2
    Thank you for the answer.
    I understood everything.

    Now I just have a new question.

    "PLCs must also be incorporated with Companies House and form a constitution (ie by adopting Articles of Association and Memorandum of Association). Additionally, they must have a minimum allotted share capital of £50,000 (with at least least 25% being fully paid up) and this needs to be reflected in a Certificate for Commencement of Trading, obtained from Companies House".

    I don't understand this bit: "(with at least least 25% being fully paid up)".
    How can shares be paid?
    Paid to whom?
    Paid by who?
    Paid before or after placing them on the stock market?

    Thanks.
  4. CL102

    CL102

    Joined:
    Oct 11, 2015
    Messages:
    15
    Paid to the company :)

    Let me explain it with an example: You create a company and decide that there are going to be 100 shares worth £1 each i.e. if anyone wants to buy 1% of your company they'll have to pay £1.

    Now you allocate all 100 of the shares to your own name but you put only £60 into your company's bank account to pay for the shares. Now 60% of your shares have been fully paid up. You still owe the company £40 to take it up to your alloted share capital of £100.

    I don't know why you mention stock market. A PLC has nothing to do with the stock market. If you ever want to list your business on the stock market you go for what's called an IPO. It's a huge and expensive operation (costing a few hundred thousand pounds) and mired in regulatory red tape. When you list on the stock market you sell a portion (or all) of your shares. Assuming you built the company up to a huge and profitable business you get, say, £10,000 for each share that originally costed you £1. Congratulations.

    (Oh, and don't forget to pay, even after Entrepreneurs' Relief, a huge capital gains tax on that big profit! ;) )
Back to top

Share This Page