Ila
Asked June 23, 2013

public unlisted company

  • 2 Answers
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What is a public unlisted company ? How is it different from priavate company ?

Answers 2

Default avatar
Kinnori

A Public listed Company is nothing but a Company owned by Public and the shares of which is available to the public, this can be done only by making the company listed in any share market of the country. A Privated listed company, is a Company owned by some few people, but they also can borrow money upto a limited extent from the market, for the process of which it again needs to regited with any of the share markets in the country. 

However, the shares of a private company is much limited.

Agree Comment 0 Agrees about 4 years ago

Default avatar
Sankalp

A public unlisted company is a Public Company under Section 3 (1) (iv) of the Companies Act. An unlisted public company is one whose securities are not listed on any stock exchange in India. Its shares are therefore not available for trading to the general public. However, an unlisted public Company cannot make a public offer of allotment of its shares to more than 49 people (as per Section 67 of the Companies Act).

A Private company (since your question is not clear about kind of private company it is taken to mean a private limited company) is governed by Section 3 (1) (iii) of Companies Act. A private limited company by its very nature is restricted to transfer shares only amongst its members and not to outsiders. A private limited company has minimum members as 2 and maximum as 50. Moreover, it cannot issue prospectus to public to subscribe to its shares. There are several advantages of an unlisted public Company which include:

1.       No need to follow stock exchange compliances,

2.       Less expenditure as listing fee has not to be paid,

3.       There is more flexibility in fund raising through preferential allotment and borrowing.

 

 

Agree Comment 0 Agrees about 4 years ago

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