Holding Company and Subsidiary Company

Holding Company and Subsidiary Company

Blog Article

A holding company and a subsidiary company serve distinct roles in corporate structures. A holding company controls one or more subsidiaries by owning a majority of their shares but does not engage in daily operations. In contrast, a subsidiary company operates independently while being controlled by the holding company. Understanding the differences between a holding company and a subsidiary company is crucial for business owners, investors, and entrepreneurs. These differences impact decision-making, financial autonomy, and legal liabilities. This article explores the key distinctions, benefits, and legal implications of both entities, helping businesses determine the best structure for growth and expansion.