Private placement

Amit Kumar Verma (CA Final CS Professional)   (501 Points)

16 November 2012  
Hi frnds.. Can any1 plz explain the meaning & difference betwn Private Placement & Preferrential Allotment. Plz tell whthr the following is a case of private placement: A private limited company had 5 members at d tym of incorporation who r either directors or relatives of directors. After 5 months it allots further equity shares to 8 persons out of which 5 are above said existing members and 3 are new members who are also relatives of directors. Thanks