Private Limited to Public Limited Company
Converting a private limited company to a public limited company in India involves a process that is governed by the Companies Act, 2013.
Here are the steps involved in the conversion process:
- Conduct a Board Meeting: The first step towards converting a private limited company to a public limited company is to convene a board meeting. In the board meeting, directors need to pass a resolution for the conversion and appoint an authorized person to make the necessary applications to the Registrar of Companies (ROC).
- Conduct a Shareholders Meeting: After the board meeting, a shareholders meeting needs to be convened. In the shareholders meeting, shareholders need to pass a special resolution for the conversion of the private limited company to a public limited company. The notice for the meeting should be sent to all the shareholders of the company at least 21 days before the date of the meeting.
- Make the Required Changes in the Articles of Association: After the special resolution is passed by the shareholders, the company needs to amend its Articles of Association (AOA) to make the necessary changes. The AOA should be altered in accordance with the provisions of the Companies Act, 2013.
- File Forms with the ROC: The next step is to file the necessary forms with the Registrar of Companies (ROC). The forms that need to be filed include Form MGT-14, which contains the special resolution passed by the shareholders, and Form INC-27, which contains the application for conversion of the private limited company to a public limited company. Along with the forms, the company needs to submit the altered Articles of Association, a copy of the special resolution, and other documents required by the ROC.
- Obtain a New Certificate of Incorporation: After the forms and documents are filed with the ROC, the Registrar will examine them and, if everything is in order, will issue a new Certificate of Incorporation. This certificate will indicate that the private limited company has been converted to a public limited company.
The fees involved in the conversion process depend on the authorized capital of the company. The fee for filing Form MGT-14 is Rs. 200, and the fee for filing Form INC-27 depends on the authorized capital of the company. For authorized capital up to Rs. 1 lakh, the fee is Rs. 2,000; for authorized capital between Rs. 1 lakh and Rs. 5 lakhs, the fee is Rs. 3,000; for authorized capital between Rs. 5 lakhs and Rs. 25 lakhs, the fee is Rs. 5,000; for authorized capital between Rs. 25 lakhs and Rs. 1 crore, the fee is Rs. 10,000; and for authorized capital above Rs. 1 crore, the fee is Rs. 20,000.