Convert Private Limited Company to Public Limited Company
A private limited company or famously known as LTD is a privately held company. This implies that the business limits owner liability to its shares and limits number of shareholders to 50. It also restricts shareholders from trading shares publicly.
A Public Limited Company, legally known as PLC, is a publicly held company. It is a limited company whose shares can be traded with the public. PLC can be listed or not listed in the stock exchanges. PLC requires a minimum of 3 Directors as a prerequisite.
Advantages of Public Limited Company (Heading)
- There is no restriction in the transferability of shares as it is open to public.
- The scope for a PLC is vast in comparison to limited number of people for a Private Limited Company.
- Capital for PLC can be raised from the general public, giving it more opportunity for growth and success.
- Systemized functioning will help in building the business and good team work
Documents required to convert Private Limited to Public Limited (Heading)
- E-form MGT 14 – Special resolution for conversion of the company into a public company is to be filed with the following attachments:
- Certified true copy of special resolution
- Altered memorandum and articles of association (MOA/AOA)
- Certified true copy of board resolution is optional
- Notice of Extra Ordinary General Meeting (EGM) that is held to pass the board resolution which is the approval of Directors for conversion of a Private Limited Company to Public Limited Company
- E-from INC 27 – Application for the conversion of Private Limited to Public Limited
- Minutes of the Meeting where approval was given for conversion and altered Articles of Association
- Altered Articles of Association
- True copy of Board resolution is optional
Frequently Asked Question
The following main points must be taken care of after the Private Limited is converted to Public Limited:
- New PAN card in the name of the company
- Update bank details
- Raise the capital to minimum 5 lakhs, if it is lesser than that
- Increase number of Directors to minimum 3