Public Limited Company

Public Limited Company

Public Limited Company is the legal designation of a limited liability company which has offered shares to the general public and has limited liability. The Company that is being constructed by minimum 7 people and maximum according to the shareholders with limited liability is called the public limited company. This company can raise funds from the general public through open invitations by selling its shares or accepting fixed deposits. This type of company is required to write either ‘public limited’ or ‘limited’ after their names. The public limited company is divided into four categories such as:

Government Company: When the government holds all the shares of a limited company or approximately 51% ownership of the company is called Government Company. The government has the responsibility to operate and regulate this type of company. The government generally takes the important financial sectors, welfare or risky or heavy industrial sectors for the country’s best interest. It also depends on the government’s political view. This type of company is also operated and regulated by the rules and regulations of the country. However, companies having less than 51% shareholding by the government can also be called the Government companies provided to control and management lies with the government

Non-government company: When maximum shares or a maximum portion of the shares of a company are under the ownership of the mass people is called as a non-government company. Generally, people are the creator, owner, and operator of these types of companies.

Holding company: When a certain company buys all or 50% shares of one or more other companies, the purchaser company is called holding company. In Company, Act 1994, section 2 [2] is mentioned as ‘If any company holds other company’s or companies’ half of nominal value of the equities or holds two-thirds of voting power directly or indirectly of electing the direct on thereby, these companies is being said as Holding Company.’

Subsidiary company: It refers to those companies in which maximum shares, voting power, operating & regulating power are in the hand of other company, as according to the companies Act sec. 2 (2), ‘If the maximum nominal value of a company’s share capital or two-third voting power or direct us indirect power in electing directors to belong to the hand of other company, then that company is called the subsidiary company of the respective company.

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