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Corp. Finance-Temporarily swapping company names

Reasons for companies temporarily swapping names

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Hi, 

Hi, I am wondering if anyone can suggest possible reasons why (common control) companies would exchange names temporarily.  I have seen this behaviour several times looking in to reverse takeover AIM shells and in the setup of alternative investment scams.

As the FCA register lists company number as well as name, my initial thought of a “pass the parcel” FCA authorisation doesn’t seem to hold water.  

The people (I’m looking back in time 10 yrs) responsible for structuring these transactions are experienced small cap ACA’s and/or reverse takeover shellmeisters (as they say) 

I wonder if anyone could suggest possible rationals for this behaviour

thanks

ian 

 

 

 

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22nd Jul 2019 16:05

I once audited a very large group that swapped names to reduce corporation tax liability so that the business went with the company name, not the company number. ie if the original company number was racking up large corporation tax bill, the name and business would be transferred to a dormant company. Very confusing to track transactions sometimes as the companies had long term (over 5 years) contracts.

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22nd Jul 2019 16:42

As part of M&A activity I've transferred activity and done a name swap. It puts the trade and assets into a clean entity. Any historic liabilities that appear are against a dormant shell.

What you've described sounds like doing that and later reversing it. The only (legitimate) reason that comes to mind is because the first swap stranded some tax losses.

Is the question out of curiosity? Or do you have a particular problem you are seeking to unravel, a suspicion of something dodgy, or something else?

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26th Jul 2019 14:45

Mr Moo - ian - are you not interested in the responses to your question? You've neither engaged with the discussion or even hit the 'thanks' button

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