Public company redemptions of shares—initial considerations
Public company redemptions of shares—initial considerations

The following Corporate practice note provides comprehensive and up to date legal information covering:

  • Public company redemptions of shares—initial considerations
  • Initial considerations
  • Terms, conditions and manner of redemption
  • Share capital requirements—number of shares to be redeemed
  • Share capital requirements—shares must be fully paid
  • Shareholder approvals—class rights
  • Shareholder approvals—allotment and pre-emption
  • Substantial property transactions
  • Financial assistance
  • Banking restrictions
  • More...

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marks the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. At this point in time (referred to in UK law as ‘IP completion day’), key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for Corporate lawyers?

A limited company that proposes to carry out a redemption of redeemable shares must comply with the provisions of the Companies Act 2006 (CA 2006). In addition to the provisions of CA 2006, there are other rules and guidelines that are relevant to a listed company or an AIM company. In particular, a listed company must have regard to the Listing Rules (LRs) and the Disclosure Guidance and Transparency Rules (DTRs). An AIM company must have regard to the AIM Rules for Companies (AIM Rules) and is also subject to DTR 5. Both types of company may also follow institutional investor guidance.

For a discussion of the legal requirements that a company must comply with in order to issue redeemable shares, and the reasons why a company may redeem its shares, see Practice Note: Issue of redeemable shares.

Initial considerations

Before proceeding with

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