How is a Public Company converted into a Private Company?


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The Company Act does not allow a Public Company to turn itself into a private company, but it neither prohibits such conversion. The conversion can take place in following ways:-

  1. A Public company can be converted into a private company by altering the articles, incorporating the three restrictions, mentioned in section 3(i)(iii).
  2. Approval of the central government is necessary for converting a Public company into a private company.
  3. Special resolution is to be passed within 30 days, after obtaining the approval of the Central Government for conversion.
  4. The word private Ltd. is used.

The conversion of a public company into a private company does not affect the identity of the company.

 


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