Q&As

Where merger relief under section 612 of the Companies Act 2006 is claimed on an allotment of shares, is it necessary to account for the premium on Form SH01?

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Published on LexisPSL on 08/03/2018

The following Corporate Q&A provides comprehensive and up to date legal information covering:

  • Where merger relief under section 612 of the Companies Act 2006 is claimed on an allotment of shares, is it necessary to account for the premium on Form SH01?

Section 610 of the Companies Act 2006 (CA 2006) provides that where a company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares is to be transferred to an account called the share premium account.

Merger relief under CA 2006, s 612 removes the requirement to credit the share premium account. Where the issuing company has secured at least a 90% equity holding in another company in pursuance of an arrangement providing for the allotment of equity shares in the issuing company on terms that the consideration for the shares allotted is to be provided by the issue or transfer to the issuing company of equity shares in the other company, or by the cancellation of any such sh

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