Question

limited companies? can a private limited company be listed in stock exchange?

Hi there
Firstly, what is the difference between private limited and public limited company. What are the major differences between them?
Secondly, Can a private limited company be listed in stock exchange.

5 years ago - 7 answers

Best Answer

Chosen by Asker

Private means the shares are not available for sale to the public, whereas a public company's share are available to the public. Since a stock exchange is where the public can buy stocks, I would guess that one wouldn't find a private company in the stock exchange.

5 years ago

Other Answers

private says privately held
public say it has stock that is publicly traded

by golferwhoworks - 5 years ago

no, a private company is not on the stock exchange.

Here's the difference. In a public company, anyone can buy shares in the company on the stock market. In a private company, the ownership is held within a group of people, and its not open for the general public to buy into.

for example, I'm thinking of starting a business with my brother in law. We will structure it as a limited liability Corporation, with each of us holding 50% of the company. But its not open for anyone else to buy into without our permission. This would be a private company.

by SmartA$$ - 5 years ago

You must be a public company to list in a publically traded stock exchange. There are a number of considerations that need to be made before going public. The exchanges impose a series of guidelines and necessary governance practices. The company must also meet certain listing criteria (varies depending on the exchange). As a public company, you must file financial reports and send copies to the exchanges. You will also need to have an AGM (Annual General Meeting) to update your shareholders. These are minimum requirements. There are many more.

by Spotless - 5 years ago

In answer to your first question, I'll list the main differences between the two (Private Limited:Pvt.; Public Limited:Plc.):

*Pvt.s can only issue shares privately ie. to friends and family. Plc.s, on the other hand, can sell shares openly to the public, to whoever would like to invest in that company.

*Plc.s are generally a lot larger than Pvt.s, employing a considerable amount of capital more.

*Another important difference lies in the fact that Pvt.s are a lot less "transparent" than Plc.s in that they do no have to issue a prospectus or announce financial records publicly, maintaining some amount os secrecy.

*Also, since Pvt.s are usually smaller than Plc.s, they may retain a lot more control over the business, since there are less shareholders.

In addition, also the answer to your second question, Pvt.s cannot list their shares on the stock exchange, whereas Plc.s are entitled to do so.

I hope this is what you were looking for! Good Luck!

by dhruvadabin_1947 - 5 years ago

You are mixing terms.

First, the companies that you are referring to are corporations. There are several types of corporations: S corps, small corps, large corps, and limited liability corps.

The limited liability corporation is usually a combination of other business entities, that could include S corps, sole proprietership, a partnership, or a corporation. The purpose of the limited liability corporation (LLC) is to shield the investors from any liability that may arise as a result of the agreement to form a working relationship with other business entitites. Usually, those entities assume the risk of liability in return for the LLC to commit capital (money) to the endeavor.

Private and Public refers to the stock of the corporation. All corporations have stock. Each corporation must decide how many shares they will put up for sale. If those shares are owned by one person, or family, or even another corporation, but the sale of those shares are restricted to the members who own them then the corporation is held privately. The public sale of the stock does not have to occur on an exchange. If the corporation's documents allow for public sale than a shareholder can sell his stock at any time to anyone for a price that either the corporations board determines or at whatever price the market will bear.

Selling on the exchange is a totally different subject. Ther are several exchanges, NYSE, NASDAQ, CME, to name the big U.S. exchanges. There are also exchanges in almost every country around the world. It costs money to belong to those exchanges and the members are usually very large corporations.

Not to be confused with Indexes. An Index is a measuring stick of the exchanges. For example, the S&P 500, is an index that measures the price fluctuations between the 500 biggest companies in the country as selected by a firm called Standard's and Poor. The Dow is another exchange. The NASDAQ has its own index. The Russell, and on and on.

Source(s)

by the mickster - 5 years ago

"Limited" refers only to "limited liability" which means a C corporation, S Corporation or LLC.

For a company to be listed it must have a minimum number of shareholders which used to be 300. Above this, it is listable ( albeit not required ) and also subject to Sarbanes-Oxley constraints and requirements.

Many companies try to keep their shareholders below that number so as to keep their private status. (Sarbanes-Oxley and other reporting requirements are both onerous, expensive and can reveal competitive information.) They so this with Buy-Sell agreements attached to each share certificate so that the shares must first be offered to either the corporation itself or to another shareholder before it can be offered to others.

by lucapacioli1492 - 5 years ago