Guidance Note – Share Redenomination

This guidance note provides a broad overview of the legal process required for companies to convert their share capital from one currency to another by ordinary resolution, to redenominate their shares in compliance with section 622 of the Companies Act 2006.

Exchange rate requirement for the resolution

Conversion must be made at a spot rate of exchange as determined by section 622.

The spot rate must be specified in the resolution.

What this guidance covers

• the procedural steps for a redenomination of shares;
• the effect of a redenomination on a company’s share capital;
• the resolutions and forms that need to be filed with Companies House to effect the redenomination; and
• reducing share capital after a redenomination for the purpose of rounding redenominated values.

Reducing share capital for rounding after redenomination

The guidance considers the process for companies to follow if they wish to reduce their share capital following a redenomination for the purpose of rounding the redenominated values to more suitable values.

This is a completely separate process to share capital reduction more generally and only applies following a share redenomination.

Reading order and scope limits

This guidance should be read in advance of preparing the documents, as it details which documents are required and the order in which they should be prepared.

This guidance only relates to the law as it applies to private limited companies.

Potential tax and/or accounting implications are not considered.

Independent legal advice should be considered when undertaking any currency conversion.

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