Updated: Aug 19
This article is to give a brief outline on how to arrange allotment of shares of a Hong Kong private company.
Difference between Share Transfer and Share Allotment
The main difference between Share Transfer and Share Allotment is about the money flow. For share transfer, it is the new shareholder paying the existing shareholder as the purchase price of the shares on his/her hand, while share allotment, this is the company to allot new shares for new/existing shareholder to purchase, this is a way to invite new investor, or to increase the shareholding power.
Another difference is that share transfer will NOT alter the shareholder portion of all members as the total number of issued shares will not change. Yet, for share allotment, because the total number of shares will be increased, if new shares are not to all present members on a pro-rata basis, dilution will happen, and thus, approval of all current shareholders are required.
Preparation of mandatory documents of Allotment of Shares – CASH base
Also, for share transfer, documents are submi