TEXT 1. Public and Private Companies

TEXTS FOR ADDITIONAL READING

ЧАСТЬ III

XXVIII. Translate the sentences into Russian.

1. We had been advertising this model for three months before we got the first order.

2. They had been studying our offer for two weeks, when we finally decided to give a discount.

3. He had been doing business with that firm for a long time, when he got an offer from their competitors.

4. They had been considering the bill for one month before they came to an agreement on the amendment.

5. She had been working for that company for five years when she dared to resign.

6. He translated the text easily. He had been learning the language for two years.

7. They had been discussing the terms of delivery for three weeks before they signed the contract.

A company is usually formed for the purpose of conducting business that is separate from its owners, the shareholders. The main difference is between public and private companies.

Private companies cannot sell shares to or raise money from the general public.

Public companies cannot sell their shares to the general public (which they usually do through a stock exchange). A company continues to exist despite changers in (or deaths among) its owners. A company can hold assets; it can sue, and it can be sued. The profits are distributed to the members as dividends on their shareholding. Losses are borne by the company. The day-to-day management of the company is carried out by a board of directors. Private limited companies are often local family businesses and are common in the building, retailing and clothing industries.

A private company can be formed with a minimum of two people becoming its shareholders. They must appoint a director and a company secretary. If the company goes out of business, the responsibility of each shareholder is limited to the amount that they have contributed; they have limited liability. Such a company has Ltd (Limited) after its name.

Many large businesses in the UK are Public Limited Companies (PLC), which means that the public can buy and sell their shares on the stock exchange. Marks & Spencer, British Telecom and the National Westminster Bank are the examples of public limited companies.

In the US, businesses take the same basic forms. American companies have abbreviations Inc and Corp.

Other types of companies are:

1) Associated company, which is a company over which another company has substantial influence; for example, it owns between 20 per cent and 50 per cent of its shares.

2) Holding company, a company that owns another company or other companies and which is sometimes referred to as the parent company (most public companies operate through a number of companies controlled by the group’s holding company);

3) Subsidiary company, a company controlled by a holding company, usually because the holding company owns (or indirectly owns through another subsidiary) more than 50 per cent of the subsidiary company’s shares.

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