The UK company law (Companies Act 2006) allows company limited by shares to redenominate its share capital or any class of its share capital into other currencies by passing a resolution.
Check the Articles of Association of your company for any clause relating to prohibition or restriction on redenomination of shares before commencement of the procedure.
Your company must use an appropriate spot rate of exchange used for the redenomination. This must either be a rate prevailing on a particular day specified in the resolution or the average rate taken from each consecutive day of a period specified in the resolution. Bear in mind that the day or period chosen must be within 28 days ending on the day before the resolution is passed.
You should follow a three step route, for each class of shares to calculate the new nominal value of each share in the class:
- Take the aggregate total of the old nominal value of all the shares of that class
- Translate that amount into the new currency at the rate of the exchange specified in the resolution.
- Divide that amount by the number of shares in the class.
You must within one month of the redenomination taking effect to deliver the company form called SH14 together with a copy of the resolution to Companies House. A statement of capital is to be completed as part of this form.
Concise Accountancy – Making company legal administration simple for businesses