Amarin Corp Plc (AMRN)

[Whalatane]

JR. for public Co's in the UK ...previous post was for private co's

Public companies can reduce or cancel their share premium account through a court-approved capital reduction procedure under the Companies Act 2006.This involves obtaining confirmation from the court that the company's creditors are sufficiently protected.
The main purpose of cancelling the share premium account is to create a distributable reserve that can be used for purposes like offsetting accumulated losses, paying dividends, or providing distributions to shareholders. Without cancellation, the share premium is a non-distributable reserve.
The process typically involves:
Passing a special resolution by shareholders approving the share premium cancellation
Making an application to the court with a statement of capital and solvency statement
The court considering the interests of creditors and confirming the reduction
Registering the court order with Companies House to make it effective
For public companies, cancelling the share premium account requires court approval, unlike private companies which can use a simpler solvency statement procedure.
So in summary, cancelling the share premium in a public UK company creates distributable reserves by court-approved capital reduction, but requires adhering to statutory procedures to protect creditors' interests.

Kiwi