A demerger by way of share capital reduction

The corporate team at Thomson Snell & Passmore recently advised a longstanding client on a demerger by way of a share capital reduction.

The client is a company owned by family members operating different businesses through various subsidiaries.

The reason behind the demerger was to enable part of the business to be split from the remainder and run independently by one of the family members.

This involved a number of steps including the incorporation of new companies, the transfer of subsidiaries and the conversion of the share capital before the demerger could take place by way of a share capital reduction supported by a solvency statement.

Please see our separate article ( for a more detailed explanation of a demerger by way of share capital reduction and the main steps involved.

If you would like more information, please contact Joanne Gallagher on or 01322 623708.

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