Private Placement Meaning?
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As per the Section 42 of the Companies Act, 2013, private placement means any offer or invitation to subscribe or issue of securities to a selected group of persons by a company (other than by way of public offer) through private placement offer-cum-application form, which satisfies the conditions specified in section 42 of the Companies Act, 2013.
Section 42 of the Companies Act, 2013 states that the maximum allotment that can be done in a year is 200, exceeding which the issue is considered public and the company has to follow the procedure of public issue.
In the process of private placement, no prospectus is issued.