Insights

Company Shareholders

Samuel Tan

Most limited companies are ‘limited by shares’. This means they’re owned by shareholders, who have certain rights. For example, directors may need shareholders to vote and agree changes to the company. Companies limited by guarantee have guarantors and a ‘guaranteed amount’ instead of shareholders and shares.

Most companies have ‘ordinary’ shares but the ‘Prescribed Particulars‘ (or Share Class) will vary from one company to the next. In most cases this means shareholders get one vote on company decisions per share and receive dividend payments.

Shareholders and Share Value

A company limited by shares must have at least one shareholder, who can be a director. If there’s only one shareholder, they’ll own 100% of the company. There’s no maximum number of shareholders.

The price of an individual share can be any value. Shareholders will need to pay for their shares in full if the company has to shut down. When forming a company, the director/s can choose a low share value (for example, £1) to limit the shareholders’ liability to a reasonable amount.

Issuing Initial Shares

When registering a company, the director/s need to provide information about the shares (known as a ‘statement of capital’). This includes:

  • the number of shares of each type the company has along with the total value – known as the company’s ‘share capital’
  • the names and addresses of all shareholders – known as ‘subscribers’ or ‘members’

Example

A company that issues 500 shares at £1 each has a share capital of £500. Share capital is not linked to how much the company is worth.

About the Shareholders

All companies are required to publish a list of their shareholders annually to Companies House. There are two key exemptions to this general rule.

  • Protected companies undertaking activities which may be targeted by activists, e.g. Animal Testing or Specialist Research
  • Companies listed on the stock exchange as the shareholders change from one day to the next

In most other cases the shareholders for each company are publicly available, this will include organisations as well as named individuals. In the example below, you will see the typical shareholding structure for four companies, this details the number of shares held in each allotment. You will also see different classes of shares which confer certain rights to the shareholder.

Company NoShareholder NameClassNo Shares
11453929Named IndividualA ORDINARY50
11453929Named IndividualB ORDINARY0
11453929Named IndividualB ORDINARY50
11165420Company NameA ORDINARY2
11165420Company NameB ORDINARY22003
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY0
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
1140084Named IndividualORDINARY1
11040266Named IndividualORDINARY25
11040266Named IndividualORDINARY75
3492496Named IndividualORDINARY1
3492496Named IndividualORDINARY1
3492496Named IndividualORDINARY1
3492496Named IndividualORDINARY1
3492496Named IndividualORDINARY0

Companies limited by guarantee

These companies must have at least one guarantor and a ‘guaranteed amount’.

Guarantors:

  • are company members
  • control the company and make important decisions
  • do not usually take profit from the company – instead the money is kept within the company or used for other purposes

Guaranteed amount

Guarantors promise an agreed amount of money to the company if it cannot pay its debts. This is the ‘guaranteed amount’.

They must pay the company the full amount of their guarantee. This payment covers guarantors for situations such as the company being closed down. The guaranteed amount is not linked to how much the company is worth – they choose how much they pay.

Other Useful Data Sources

Combining shareholder data with the Significant Controllers Register will allow you to create a corporate structure and identify which companies or individuals control other companies.

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