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Transfer of a company and issues of shares

M owns 100% of F Ltd and 100% of O Ltd.

M wants to move F Ltd so it is wholly owned by O Ltd. M also wants to issue shares to P and to T so that the ownership of O Ltd is M 34%, P 33% and T 33%.

Neither F Ltd nor O Ltd have ever traded, they have no value in them and neither is more than 18 months old.

Is there a better order for these transactions?

i.e transfer the shares of F Ltd to O Ltd and then issue new shares in O Ltd or

issue new shares in O Ltd and then bring in F Ltd as a wholly owned subsidiary?

Anythin else to watch out for?


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12th Jan 2012 19:44

Forgive me for stating the obvious

But if neither company has traded and neither company has any value, why not start afresh? OK, it'll cost you the expense of forming two new companies, but probably cheaper than engaging lawyers to deal with the transfer paperwork.

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13th Jan 2012 18:45

Strangely, the legal bit has been done very cheaply by a friend, the order of play would be good to know, however.

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