Company Structure · 6 min read

Share Capital & Share Allotment Explained - How to Split Your Nigerian LTD

Authorised vs issued shares, allotment splits, and the mistakes that lock co-founders into bad equity decisions. Read before you file.

When you register an LTD with CAC, you must declare your share capital and how those shares are split between owners. Get this wrong and you'll spend years (and lawyers) trying to fix it.

Authorised vs Issued Shares

Authorised share capital is the maximum number of shares the company is allowed to issue. Issued shares are what's actually been given to shareholders. You can authorise ₦10,000,000 in shares but only issue ₦1,000,000 today - leaving room to onboard investors later without amending your MEMART.

Standard share value

Nigerian LTDs typically use ₦1 per share. So ₦1,000,000 share capital = 1,000,000 shares. Splitting becomes simple arithmetic.

Common allotment splits

How founders typically divide shares:

Solo founder: 1,000,000 shares (100%)
Two equal co-founders: 500,000 / 500,000 - risky, causes deadlocks
Lead + co-founder: 700,000 / 300,000 - clear decision maker
Founder + 2 partners: 600,000 / 200,000 / 200,000
With investor allocation: founders 800,000, reserved 200,000 for future investors

Mistakes that cost founders dearly

Three things we see all the time at AMG:

Splitting 50/50 with no tie-breaker - boards stall, banks freeze, businesses die
Issuing 100% of authorised shares on day one - no room to bring in investors without expensive amendments
Naming the wrong director as majority shareholder because the agent rushed the form

Get the structure right the first time