This means only the total number of shares is reduced but the amount of share capital remains unchanged. Subdivide all or any of its shares into shares of smaller denomination. This is referred to as a “share split”.To raise capital: Companies may need to raise additional capital to fund their expansion plans or to meet their working capital requirements. Alteration of share capital allows them to issue new shares and raise capital from the market.
Section 16 of the Companies Act pertains to the alteration of share capital. It provides guidelines for companies to make changes to their share capital structure. This section outlines the procedures and requirements for altering the share capital, including increasing or reducing the share capital, consolidating or dividing shares, converting shares into stock, and reclassifying shares. These alterations typically require the approval of shareholders through a special resolution and compliance with regulatory provisions. It is important for companies to follow the legal requirements and obtain necessary approvals when making any alterations to their share capital.
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This means only the total number of shares is reduced but the amount of share capital remains unchanged. Subdivide all or any of its shares into shares of smaller denomination. This is referred to as a “share split”.To raise capital: Companies may need to raise additional capital to fund their expansion plans or to meet their working capital requirements. Alteration of share capital allows them to issue new shares and raise capital from the market.
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Explanation:
Section 16 of the Companies Act pertains to the alteration of share capital. It provides guidelines for companies to make changes to their share capital structure. This section outlines the procedures and requirements for altering the share capital, including increasing or reducing the share capital, consolidating or dividing shares, converting shares into stock, and reclassifying shares. These alterations typically require the approval of shareholders through a special resolution and compliance with regulatory provisions. It is important for companies to follow the legal requirements and obtain necessary approvals when making any alterations to their share capital.