Conversion of a Private Limited Company in to Public Limited

A Private company can be converted in to public company by complying with the following requirements:

> Alteration of its articles thereby deleting the three restrictions of a private company, by passing a special resolution as per Section 14; and

> Changing its name thereby deleting the word ‘Private’ from its name, by passing special resolution as per Section 13

Further, if the number of members is below 7, steps should be taken to increase the number of members to atleast 7 and that the number of directors should be increase to atleast 3, if there are only 2 directors.

The company becomes public from the date of passing Special Resolution under Section 14. But the change in its name, by deleting the word ‘Private’ becomes effective only on the issue of fresh certificate of incorporation by the Registrar of companies.

Procedure for conversion of a Private Limited Company in to Public Limited

1. Convene a board meeting to:

• For approving proposal for conversion of the company into a public company.
• For fixing time, date and venue for holding the general meeting of the company for passing the required special resolution.
• For approving notice for the general meeting along with the explanatory statement as required.
• For authorizing the company secretary or any other competent officer to issue notice of the general meeting on behalf of the board.

2. Issue notice to all members of company.

3. Hold the general meeting and pass the following special resolutions

• Special Resolution for alteration of articles for conversion.
• Special Resolution for alteration of memorandum (name clause).

4. Copy of special resolution along with explanatory statement to be filled with in 30 days with the registrar in form MGT-14 and copy of altered Memorandum and Article shall be attached there with.

5. Make an application in Form INC-27 to ROC for conversion of Private Company in to Public Company.

6. Obtain from the Registrar of companies, fresh certificate of incorporation consequent upon conversion of a private company in to public company.

7. The change of name will be noted in the memorandum and articles of association, letter heads, bills, common seal, if any, etc.