What is a subsidiary?

From a legal point of view, the company is a group of individuals who have created an association to carry out, keep up or otherwise participate in an industrial or commercial enterprise. There are different types of companies, and some include a holding company, a collection company, a limited liability company, a trusted company, a parent company and a subsidiary. The subsidiary - the general importance of the subsidiary should be subordinate - is a company that is controlled or owned by another company. A company that owns or controls a subsidiary is called the parent company.

There are several different types of relationships that a subsidiary with a parent company may have. In one type of relationship, the parent company is the holding company, which means that its primary function is to control other companies rather than engage in their own business. The holding company owns most of the shares in the subsidiary. If the parent is their own andKcia, then the subsidiary is completely owned by a subsidiary.

The organization of the parent company and the subsidiary of the company differs from the merger in which the company is owned, immersed in the identity and corporate structure of the company buyer. The comparison between the subsidiary and the merged company brings another fact about subsidiaries that distinguish this relationship from the merger: a subsidiary can be created rather than purchased. Another important difference is the role of shareholders acquired. While the approval of shareholders is required for merger, it is not necessary if the company becomes a subsidiary by purchasing a control share on it.

The creation of a subsidiary may be beneficial for multinational corporations that wants to adapt its business to work the sleeve of a particular country. Creating a subsidiary is often cheaper than merging. CrusThe subsidiary retains its brand, which can have an irreplaceable market value, and the maintenance of a subsidiary of a subsidiary can reduce responsibility in a risk business as a result of the company's identity department.