Private Company into Public Company

Conversion of Private Limited into Public Company

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
  All movable and immovable properties of the firm automatically vest in the Company. No instrument of transfer is required to be executed and hence no stamp duty is required to be paid.

Key Conditions:

All partners of the partnership firm shall become shareholders of the company in the same proportion in which their capital accounts stood in the books of the firm on the date of the conversion.

The partners receive consideration only by way of allotment of shares in companyand The partners share holding in the company in aggregate is 50% or more of its total voting power and continue to be as such for 5 years from the date of conversion.

Key Requirements:

• Minimum Authorised Share Capital shall be Rs. 500,000 (INR Five Lac)
• Minimum Paid-up Share Capital shall be Rs. 500,000 (INR Five Lac)
• Minimum 7 Shareholders
• Minimum 3 Directors
• The directors and shareholders can be same person
• If the above requirements are not fulfilled by the Private Company, then the relevant alterations / changes to be made before conversion
• DIN (Director Identification Number) for all the Directors
• DSC (Digital Signature Certificate) for one of the Directors

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

STEP NO.	STEPS	TIME FRAME(Working Days)	Processing
1	Board Meeting	2	Pass a resolution for deletion of articles (which are originally required to be included in the articles of a private company) and recommend it to the shareholders for adoption by them at a General Meeting
2	DSC (Digital Signature Certificate) Getting DSC for any one of the Director for digital authentication of the Incorporation documents	1
3	DIN (Director Identification Number) Approved DIN is a pre-requisite for incorporation process	1
4	Preparation of Main Object & Name Availability Search Preparation of Main Object by BMC The Promoters have to provide atleast 6 (Six) names in the order of priority To make an online search of availability of names as desired by the Promoters Confirmation of the draft main object & the final name	3 (Varies by the response time taken by the Promoters)
5	Application for Name Availability Filing of Form 1A with the concerned ROC	5
6	Final Process: After ROC's approval for name of the Company, filing all the Incorporation documents with the ROC Online uploading of e-Forms Payment of Registration fees Receiving Incorporation Certificate	5