Private Limited Companies (Ltd)

Features
1. Owned by Shareholders (2-50)
  1. Business invites SELECTED individuals to buy shares
2. Has a board of Directors (+Chairman) - usually minimum of 2
3. Has an AGM between shareholders and directors
Advantages
1. Limited Liability - business has its own legal identity
2. Easier to raise finance
  1. Shares can be sold to investors
  2. Banks are more willing to give loans
3. Continuity
  1. Business unaffected by shareholder death
  2. Individual shareholders can sell their shares
  3. With all shareholders' agreement, the business can be sold
4. Easier to gain 'economies of scale'
Disadvantages
1. Financial Information is available to the Public
2. Growth may be limited by max.50 shareholders
3. Payment of dividends to shareholders
4. Submitting information to Registrar of Companies - money and time consuming
5. Existing shareholders may be unable to provide more capital
  1. Business can't sell shares to public
  2. It may be difficult to find a willing investor

Resource summary

	Created by Alex Wykes over 12 years ago