Can A Private Limited Company Run More Than One Business?

Can A Private Limited Company Run More Than One Business?

Is it possible for private limited companies to own more than one business? Here is our detailed answer to your question. Take a look at the whole article for a full understanding. 

Incorporation requires a Memorandum of Association, which authorizes and authorizes the company. This document outlines the company’s goals and purposes. This is an example of a private limited company running multiple businesses.

A company explains its operation in its articles of association and bylaws. Every Indian company is required to have a Memorandum of Association, as stipulated by the Indian Companies Act 2013.

For the formation of a company, a Memorandum of Association is required. According to section 4 of the Companies Act, 2013, every MOA must state the Company’s object, as well as its objective.

A company’s “object clause” must be included in its Memorandum of Association, as prescribed by the MCA. The object clause of a company specifies what types of activities it should pursue and the scope of its activities.

The MOA: How Should It Be Specified?

Following are a few points that will help you to understand MOA statements.

  • As part of the MOA, all activities should be listed as supporting and incidental to the main objective of the company.
  • There should be no going beyond the provided object clause, i.e. it would be outside one’s authority and null and void.
  • In order to limit or monitor the company’s action, the object and mission of the company are noted and approved during the registration process.
  • A company must list all the activities it will conduct after incorporation, regardless of whether they are related or not.
  • Many activities can be approved by the members of a private limited company.

Let’s move straight to the question now that you know what MOA is and what it does.

Can A Private Limited Company Run More Than One Business?

A company can operate more than one business. In addition, the company may take part in activities unrelated to its objectives. Owning more than one business.

Multiple companies can be consolidated in specific ways. Listed below are some of them.

A company with multiple subsidiaries can establish more than one subsidiary company, and the main company can be a Private Limited Company.

As a sister concern company, the board of directors may be made up of members from the board of the primary private limited company.

A common name for a group of companies. Reliance and TATA are examples.

Neither the Primary nor Secondary Private Limited Companies will necessarily have the same directors. A merger or acquisition can take many forms, including amalgamation, merger, acquisition, or takeover.

In the MOA, your company is outlined what it is allowed and prohibited to do. Hire an expert to draft the perfect MOA.

Read More,

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