what is reducing share capital ?
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Capital reduction is the process of decreasing a company's shareholder equity through share cancellations and share repurchases, also known as share buybacks. ... In some capital reductions, shareholders will receive a cash payment for shares canceled, but in most other situations, there is minimal impact on shareholders.
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Reduction of Share Capital is also known as Internal Reconstruction. According to the provisions laid down in Sections 100 to 105 of the Companies Act, 1956 a company can reduce its share capital. ADVERTISEMENTS: Reduction of Capital can be carried out by a company if it is authorised by its Articles.
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