Holding Companies and Equity Stakes
Finding information on company shareholders and how they are structured is a time-consuming process that normally involves trawling through PDFs on Companies House.
Take the example of the UK government’s Future Fund set up in May 2020 to help innovative and high-growth British businesses secure investment during the COVID19 crisis.
UK-based companies were able to apply for a convertible loan of between £125,000 and £5 million to support continued growth and innovation. To help protect the taxpayer the loan value had to be matched by investors, be that an individual, venture capital fund or another company.
As per the terms of the scheme if the loan isn’t paid back it will be converted to an equity stake in the company based on the valuation at the time of raising.
By the time the scheme closed in January 2021 over £1 billion had been loaned to 1,055 individual companies. Some companies have already decided to convert the loan to an equity stake rather than pay it back. As a result, the UK government is now a shareholder in Aviation technology as well as Toilet and Cup makers.
To handle this diverse portfolio the government has set up a company called “UK FF NOMINEES LIMITED” to hold the equity. The same principle would apply to other holding and investment companies.
“UK FF Nominees has invested over £1 Billion in 1,055 UK based companies in 11 months”
How do we find out who holds what?
You can track shareholder positions by monitoring the shareholder list for individual companies. However, you’ll also need to note what the prescribed particulars are (i.e. share rights). The board of each company decides what the prescribed particulars are for each class, these are made available via Companies House.
Sticking with the example of UK FF NOMINEES if we wanted to know more about who they have a shared stake in we have a couple of options.
Via Companies House
Search on Companies House for the company you are interested in, click on ‘Filing History’ view the PDF for the most recent Confirmation Statement. This will list all the share classes along with the number of shares held by each shareholder. In the case of the Aviation Technology company (ALTITUDE ANGEL LTD) you’ll see UK FF NOMINEES listed as a shareholder with 9,786 “A3 Preference” shares. This share class gives them preference over other share classes should the company go into liquidation.
UK FF NOMINEES does not need to publish which companies it has a shareholding in so you’ll need to individually monitor the share register for the companies you are interested in. UK FF NOMINEES does not publish a list of companies they have invested in on Companies House.
If you look at the ‘Company Share Register’ row for the aviation technology company under ALTITUDE ANGEL LTD you will see ‘UK FF NOMINEES’ listed as a shareholder. You can also view the other share classes with their associated rights under the ‘Share Classes Issued by the Company’ row.
As Doorda extracts all the shareholder data on daily basis we can present a list of shareholdings held by companies in other companies. These are defined as holdings.
If you want to see which other companies UK FF NOMINEES is a shareholder in you can see them in one place under the ‘Shareholdings held in other companies’ row. This data returns the class along with the number of shares held in all the companies they have a reported stake in, to understand what the share rights are (prescribed particulars) view the share classes section under the relevant company.
If you are only interested in a couple of companies then the process is reasonably straight forward but if you are tracking several organisations and need information in real-time then you’ll need to automate.
The good news is that our data is refreshed daily so as changes are reported in the company confirmation statements, we capture the data and publish the updates to the individual company register as well as the shareholdings in other companies holdings.
You can easily integrate this data into your own application via our API by linking on company number allowing you to set alerts as the information changes.
Feel free to utilise our search tool to see what else we track; everything is built on our API so imagine what you could create!