Question

Explain why the owners of a company might choose to keep it private.

Answer 1

ANSWER DOWN BELOW. FEEL FREE TO ASK ANY DOUBTS. THUMBS UP PLEASE.

The owners of the company prefer to keep the company as private limited due to the following reasons:

1. The time taken for the issue of shares and raising capital is significantly less.

2. Statutory compliance is less.

3. It provides significant control to a small group of investors.

4. Less number of directors required.

5. Restriction on transferability of shares ensures to a certain extent that ownership remains in the hands of those desired.