What is the effect of increase in share capital on the control of a firm in the UK?

An increase in share capital can dilute the control of existing shareholders in a UK firm, especially if new shares are issued to outside investors or new shareholders. This dilution occurs because the ownership percentage of current shareholders decreases, potentially reducing their influence in decision-making processes. However, if existing shareholders participate in the capital increase, they can maintain their proportional control. Overall, the effect on control largely depends on how the new shares are distributed and who subscribes to them.