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Private Limited Company (LTD) and Public Limited Company (PL

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Yuka Ashida

on 11 September 2013

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Transcript of Private Limited Company (LTD) and Public Limited Company (PL

Private Limited Company (LTD) and Public Limited Company (PLC)
design by Dóri Sirály for Prezi
Limited Companies
Limited Liability

Legal Personality


Private Limited Companies
“A small, medium-sized business that is owned by shareholders who are often members of the same family. This company cannot sell shares to the general public.”

will be owned by original sole trader, relatives, friends and employees

Limited liability
Separate Legal Personality
Continuity in the event of the death of the shareholder
Original owner is still often able to retain control
Able to raise capital from sale of shares
Greater status than an unincorporated business

Capital cannot be raised by sale of shares to the general public
Quite difficult for shareholders to sell shares
End-of-year accounts must be sent to Companies House
Legal formalities involved in establishing the business

Public Limited Company
“A limited company, often a large business, with the legal right to sell shares to the general public- share prices are quoted on the national stock exchange”

“Divorce between ownership and control”

When a private limited company converts into a public limited company

Richard Branson
Richard Branson and the Virgin Group converted into a public limited company
However, he converted back to a private limited company

Limited liability
Separate Legal Identity
Easy to buy and sell shares for shareholders
Access to substantial capital sources

Legal formalities in formation
Cost of business consultants and financial advisers
Share prices vary/fluctuate
Risk of takeover
Directors influenced by short term objectives of major investors

In front of you is a quiz that contains multiple choice and gap filling questions. The pair that gets the highest score gets chocolate! :)
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