Convert Private Limited Company to Public Limited Company
The legal form and operational framework of a Private Limited firm (PLC) are fundamentally altered when it transitions from a privately owned to a publicly held firm. In real terms, this conversion means the following:
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INTRODUCTION
Do you know about converting a private limited company to a public limited company?
A private company’s conversion to a public company creates additional prospects, particularly with regard to market reach and finance. The business takes deposits in addition to using public issuance to raise money. This particular structure is suitable for medium-sized and large-scale enterprises. The conversion will be followed by the government’s approval and an adjustment to the MoA and AoA.
In addition, for Pvt Ltd to become Public Ltd, a minimum of 7 members and 3 directors are needed. Even after the conversion, the company’s rights, duties, powers, and liabilities don’t change. Shares may be transferred since the conversion removes the transfer restriction.
ADVANTAGES
Advantages of Conversion of Private Limited into Public Limited
Raising capital through public issue of shares
The best feature of a public limited corporation is its capacity to raise capital. In particular, investors from hedge funds, mutual funds, and other investment vehicles may be drawn to it if it is listed on a reputable stock exchange market. Compared to a private limited company, a substantially larger quantity of capital may be raised.
Brand Awareness
Upon going public, a company is listed on a stock market, which instantly increases public awareness of the firm and its operations. Consequently, this enhanced awareness of the brand will lead to a rise in business.
Limited liability
Each member or shareholder has a restricted amount of obligation. With this conversion, this attribute is retained. To the degree of their ownership, they are only liable. There is no risk to the members' or shareholders' private or individual assets.
Transferability of shares
Compared to private limited companies, shares of a public limited company are more easily transferable. The shares' liquidity allows the stockholders to sell them and profit. People are encouraged to invest since they are not obligated to stay with the firm indefinitely.
A LIST OF DOCUMENTS
Documents Needed for a Private Company to Become a Public Company
PAN Card
PAN Card of all partnersForeign nationals may provide passport
Address Proof
Current Bank Account Statement for Directors and Shareholders; Telephone Bill; and Electricity Bill
Photograph
Latest Passport size photograph of all partners
Business Address Proof
Bills for telephone and electricity at the registered office address
NOC from owner
A certificate of no objection must be acquired from the registered office's owner.
Rent Agreement
Rent Agreement of the registered office should be provided, if any
Identity Proof
Directors' and shareholders' driver's license, passport, or voter ID
Note
The partner's paperwork need to be notarized or apostilleled if they are a foreign national, or NRI.
Incorporation documents
Certificate of Incorporation, MoA, and AoA will be given.
Financial Statements
Certified copy of latest audited financial statements
Income Tax Return
ITR to be submitted that was filed for the prior fiscal year
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Convert Private limited to Public Company in 3 Easy Steps
1. Respond to Quick Questions
- Our questionnaires take less than ten minutes to complete.
- Give the essential information and paperwork needed to convert a proprietorship to a partnership.
- Pay using a safe and secure payment gateway.
2. Experts are Here to Help
- Dedicated Relationship Manager
- Procurement of Digital Signatures (DSC)
- Alteration of MoA & AoA
- Documents drafting including incorporation documents
- Certificate of Incorporation
- Application for PAN and TAN
3. Your private company is converted to Public limited
- All it takes is 20 – 25 working days*
Process of conversion into Public Company
Day 1-2
- Consultancy and assistance for conversion
- Collection of basic information & documents
- Application of DSC of new director
Day 3– 7
- Drafting of necessary resolutions
- Drafting of other required documents & affidavit
- Alteration of MoA & AoA
- Provide documents required drafted after signature
Day 8 – 15
- Online submission of forms for changes in the MoA and AOA
- The time it takes the government to approve an application*
Day 16 – 20 onwards
- Online submission of the conversion-relevant form
- The time it takes the government to approve an application*
Explore Private to Public company conversion
Frequently Asked Questions
- A public limited corporation must have a minimum of 7 shareholders and 3 directors in order to be incorporated. In the case of a private corporation, the minimum authorized capital is ₹ 5 lakhs, as opposed to ₹ 1 lakh.
- “Limited” shall be used in lieu of the suffix “Private Limited.” The corporation must first obtain the shareholders’ approval for this modification before making the necessary adjustments to the Memorandum of Agreement.
The Public Limited Company must take steps to strengthen its statutory compliance because it handles the public’s money. The regulatory responsibilities include income tax as well as ROC/MCA, SEBI, RBI, and other organizations. Given that the stakes are higher than for any other company, it is crucial to take additional precautions.
- The MoA and AoA must be drafted as soon as the ROC sends the name approval letter. The restriction to Private Company as specified by definition is removed, and the name and capital clauses are modified as well.
- After receiving a new Certificate of Incorporation from RoC, the company is able to begin conducting business as a Public Company.
- In 20 to 25 working days, rsrlawszone.in may assist you in converting your private limited company to a public limited company. The client’s submission of pertinent documents and the pace of government approvals will determine how long the conversion takes. It is important to make sure that all necessary documents are presented in order to guarantee quick conversion.
