A Private company is an organization which limits its number of members to 200 and cannot invite public to subscribe to its shares. The Companies Act, 2013 provides for converting a Public Company to a Private Company by altering the MOA and AOA of the company
A Public Company 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.
The main advantage of Public Company is that it can raise reserves at a large scale without approaching banking system and reducing debt whereas Private Companies which are privately owned, all the reserves are raised by existing members, shareholders and promoters. If a Private company goes public then the risk is also shared among the shareholders. Public companies once recorded, get indirect promotions and support through stock exchange websites where their stocks are recorded.
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 Public Limited Company to Private Limited Company.
E-from INC 27 – Application for the conversion of Public Limited to Private Limited.
Minutes of the Meeting where approval was given for conversion and altered Articles of Association.
Altered Articles of Association.
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