Private to Public Limited Company

Need to convert from Private to Public Limited Company?

Conversion of Private to Public Limited Company Starting at Just Rs.39,999/- (Inclusive of all Govt. Fees).

Convert a Private to Public Limited Company

Afairly straightforward process, but do remember that you need three directors, seven shareholders and a paid-up capital of at least Rs. 5 lakh. It's great news that you're looking to go public. The process to convert from private to public limited company is simple, but will take 30 to 35 days to complete, as there are many steps involved. First you need to alter the articles of association, then delete the word private from your name, commence the registration process and finally wait for the certificate of commencement of business. Do note, however, that some requirements and charges will depend on whether or not you already have three directors, seven members (shareholders) and a paid-up capital of Rs. 5 lakh (all are necessary for a public limited company).

Conversion of private limited company to public limited company is beneficial as it brings with it larger capital inflow. Public limited is a better option than a private limited company when a company plans to expand. A public limited company can advertise its shares and the shareholders enjoy the benefit of limited liability.

Advantages of Public Limited Company

Quick Share Transfer

Shareholders of a public limited company can transfer their shares with great ease. All they need to do is file the share transfer form and hand over the share certificate to the buyer. The process of transferring your share in other business structures is hugely tedious.

Raise Capital

The big advantage of the public limited structure is that you can leverage it to raise capital from the general public through shares. This would, however, require listing on a stock exchange. All public limited companies can issue fixed deposits, debentures, convertible debentures to the general public.

Greater Credibility

Public limited companies need to disclose their audited statement of accounts, inform the regulatory bodies of any structural change and hold annual general body meetings for all shareholders. It's tedious but these compliances bring a public limited company a great deal of credibility to the organisation.

Key Benefits

Easy access to Public for raising funds

Public limited Company is the only corporate form of organization which is allowed to raise funds from general public. Public Limited Company enjoys better avenues for borrowing of funds. It can issue debentures, secured as well as unsecured, accept deposits from the public, etc. Banking and financial institutions prefer to render large financial assistance to Public Limited Companies. Even a closely held Company can operate as a Public Company without diluting promoters' stake.

High market recognition

Public Limited Companies as compared to other business forms enjoys better recognition in the market and bestows confidence in the stakeholders.

Steps in Conversion of a Private Limited Company into a Public Limited Company

Steps

Board Meeting
Notice of General meeting
Filing of Special Resolution with RoC
Filing of Prospectus or Statement in lieu of prospectus

Minimum requirements for Conversion

Minimum Authorized Share Capital might be Rs. 500,000.
Minimum Paid-up Share Capital might be Rs. 500,000.
Minimum 7 Shareholders.
Minimum 3 Directors.
DIN (Director Identification Number) for all the Directors.
The directors and shareholders can be same person.
DSC (Digital Signature Certificate) for one Director.

Note: If the above requirements are not fulfilled by the Private Company, then the relevant alterations / changes to be made before conversion.

Conversion of Private limited Company into Public limited Company

A public company is an organization which has seven or more members and can invite public to subscribe to its shares. A subsidiary company of a public company is deemed to be a public company. A private company is an organization which limits its number of 200 members and cannot invite public to subscribe to its shares. The Companies Act, 2013 provides for converting from one type of a company to another. A public company registered under the Companies Act, can change to a private company by altering the Memorandum of Association and Articles of Association of the company.

The main advantage for public Company is that the Company can raise reserves at a large scale without approaching banking system and reducing debt. Where in case of private Companies which are privately owned, all the reserves are raised by existing members, shareholders and promoters. If private company goes public then the risk is also shared among no. of shareholders. Public companies if get recorded then they get indirect promotions and supports through stock exchange websites where their stocks are recorded. Public company can expand by combining or amalgamating with different companies and getting additional benefits of market, monopolies, assets, etc.

FAQ

Is it necessary to have 3 directors for Public Limited Company?

Yes, you need a minimum of three Directors for a public limited company. If you are sole owner, you can register as a One Person Company.

Who can be a member in Public Limited Company?

Any individual/organization can become the member of the public limited company including foreigners/NRI.

For conversion of private limited company into public limited company do I have to be present in person?

The entire procedure is 100% online and you don’t have to be present at our office or any other office for conversion. A scanned copy of documents has to be sent via mail.

Are there any other payments to be made for incorporation certificate in addition to fee paid at the time of conversion?

There is absolutely no other payment. We will send you an invoice that is all-inclusive, with no hidden charges.

Time taken by Businessgig in converting a Private Limited Company into Public Limited Company?

Businessgig can convert a Private Limited Company in 14-20 days. The time taken also depends on relevant documents provided by the applicant and speed of approvals from government. To ensure speedy registration into public limited company, please pick a unique name for the proposed Company.

What are the statutory compliances required for a Public Limited Company?

A Public Limited Company must hold a Board Meeting at least once in every 3 months. In addition to the Board Meetings, an Annual General Meeting must be conducted by the Public Limited Company, at least once every year.

How long does it take to incorporate a Public Limited
Company?

Legalwiz.in can incorporate a Public Limited Company in 20 working days. The time taken for incorporation will depend on submission of relevant documents by the client and speed of Government Approvals. To ensure speedy incorporation, please choose a unique name for your Company and ensure you have all the required documents prior to starting the incorporation process.

What documents are required to incorporate a Public Limited Company?

Identity proof and address proof is mandatory for all the proposed Directors of the Company. PAN Card is mandatory for Indian Nationals. In addition, the landlord of the registered office premises must provide a No Objection Certificate for having the registered office in his/her premises and must submit his/her identity proof and address proof.

What is the number of people required to incorporate a Public Limited Company?

A minimum of 7 people are required to incorporate a Public Limited Company. The limited company needs to have a minimum of 7 shareholders an 3 directors.

What are the requirements to be a Director?

There are no limitations of citizenship to be a director. But the person should be 18 or above 18 years of age.

What documents are required to incorporate a Public Limited Company?

Identity proof and address proof is mandatory for all the proposed Directors of the Company. PAN Card is mandatory for Indian Nationals. In addition, the landlord of the registered office premises must provide a No Objection Certificate for having the registered office in his/her premises and must submit his/her identity proof and address proof.

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