ICANBusiness LawCompany Law: Directors, Meetings and Shares2025

Kano Logistics Plc is being incorporated as a public limited company with a proposed initial issued share capital of 3,000,000 ordinary shares of 50 Kobo each. Based on Section 27(2)(a) of CAMA 2020 regarding minimum issued share capital, which of the following statements is correct?

AThe proposed issued share capital is valid because it exceeds the general threshold of ₦100,000
BThe proposed issued share capital is non-compliant because it falls short of the statutory minimum of ₦2,000,000 by ₦500,000CORRECT
CThe proposed issued share capital is non-compliant because public companies require a minimum issued capital of ₦10,000,000
DThe proposed issued share capital is valid because the minimum capital requirement applies only to authorized share capital
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Why the answer is B, and why the others tempt you.
Section 27(2)(a) of CAMA 2020 replaces authorized share capital with minimum issued share capital, setting it at ₦100,000 for private companies and ₦2,000,000 for public companies. Kano Logistics Plc's proposed capital is 3,000,000 shares × ₦0.50 = ₦1,500,000, which falls short of the required ₦2,000,000 for a public company by ₦500,000.
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