Reduction of capital: may a company pay for a departing member's shares by way of solvency statement reduction of capital? | Practical Law

Reduction of capital: may a company pay for a departing member's shares by way of solvency statement reduction of capital? | Practical Law

We asked 4 Stone Buildings whether, where a member of a private limited company (not an employee) wishes to exit and dispose of his shares, but there is no third party buyer, there is there any reason that he cannot be paid by way of a solvency statement reduction of capital under section 641 of the Companies Act 2006 (with payment being made to him as a return of capital).

Reduction of capital: may a company pay for a departing member's shares by way of solvency statement reduction of capital?

by Charles Marquand, 4 Stone Buildings
Law stated as at 23 Jun 2014 • United Kingdom
We asked 4 Stone Buildings whether, where a member of a private limited company (not an employee) wishes to exit and dispose of his shares, but there is no third party buyer, there is there any reason that he cannot be paid by way of a solvency statement reduction of capital under section 641 of the Companies Act 2006 (with payment being made to him as a return of capital).