Company A is holding Listed company. Company B, Public unlisted co., is subsidiary of Company A. Company C Public unlisted co., is subsidiary of Company B. Now, Company C has acquired 99% of shares of Company X, Private Limited.
Trust by virtue of step down subsidiary, Company X has become ultimate subsidiary of Company A, WHICH IS Public co.,
The query is Should Company X (Pvt) now comply with the provisions of Public Company. In such case should it increase the number of directors and members. What other compliances need to be followed. Pl clarify
11 January 2011
X is a public company as per Section 3(1)(iv) of the Companies Act, 1956 and all provisions pertaining to a public company will apply.
In addition to what is stated, it's required to have a Audit Committee as per Section 292A, need to appoint MD/WTD (if paid up capital is >5 crores) as provided in section 269, subject to managerial remuneration limits specified in Sections 198, 309, 310, Schedule XIII, etc. Many other sections viz., 300, 372A which are not applicable to a private company will apply to this company.
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