Restructuring a games studio's share capital: alphabet shares and transfers to personal holding companies
Redesignating the founders' shares into separate classes for dividend flexibility, then moving them into their own holding companies
By Malcolm ZoppiTechnology and software
Key facts
- Deal type
- Corporate restructuring
- Acting for
- The company and its founder shareholders
- Business
- Japanese-language digital games development studio, London
- Sector
- Technology and software
- Deal value
- Not applicable
- Structure
- Redesignation of ordinary shares into separate classes; transfer of each founder's shares to a personal holding company; new articles
- Timescale
- A few weeks
- Completed
- Summer 2026
- Lead solicitor
- Malcolm Zoppi
At a glance
The founders of a London studio developing Japanese-language digital games wanted two things: the ability to pay dividends to each of them in different amounts, and to hold their shares through personal holding companies rather than in their own names. We redesignated the existing ordinary shares into separate classes, one per founder, adopted articles setting out the rights of each class, and transferred each founder's shares to a holding company. The work completed in the summer of 2026.
The client and the objective
With a single class of ordinary shares, every dividend has to be paid to all shareholders in proportion to their holdings. The founders wanted the flexibility to declare dividends on one class and not another, so that profit extraction could follow each founder's circumstances. Holding the shares through companies, on the advice of their accountants, allowed each founder to decide separately when to take money out personally.
The steps
- Redesignation of the ordinary shares into separate alphabet classes, one for each founder, with identical rights other than the ability to declare dividends separately on each class.
- Adoption of new articles of association setting out the class rights, including what happens to each class on a sale and how new shares are issued.
- Shareholder resolutions, board minutes and Companies House filings to put the redesignation into effect.
- Transfer of each founder's shares to a newly incorporated holding company, with stock transfer forms, board approvals and the PSC register updated.
Key legal points
Getting alphabet shares right
Alphabet shares only work if the articles actually give the directors the power to declare different dividends on different classes, and if the classes are otherwise equal so that neither founder is disadvantaged on a sale or winding up. The articles were drafted to say exactly that.
Holding companies and control
Once shares are held by a company rather than a person, the person with significant control is still the founder behind the holding company, and the PSC register has to reflect that. We dealt with the registers and filings for both the studio and the new holding companies.
Tax steps left to the accountants
The transfers were structured on the founders' accountants' advice, with the stamp duty and capital gains position confirmed before anything was signed. Our role was the company law mechanics; the tax analysis stayed with the advisers who knew the founders' positions.
Outcome
The redesignation, new articles and transfers completed in the summer of 2026. The founders now hold their shares through their own companies, each in a separate class, and the studio can pay dividends to each class independently.
What this deal shows
- Alphabet shares are a simple way to give founders dividend flexibility, provided the articles are drafted for it.
- Moving shares into holding companies is routine but has filings and registers attached that are easy to miss.
- Company law and tax advice need to run together on restructurings like this.
“Two founders, two sets of circumstances, one dividend policy that could not accommodate both. Separate share classes and holding companies solved it in a few weeks.”