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Holding and subsidiary company

Mrs.n (CS, LL.B ) (407 Points)

27 July 2012

Kindly help me in understanding the foll Concept.

1) how can a company becomes Holding and Subsidiary company by voting rights??.company is having equity and preference shares .both.

pls help.

Regards

Joshi

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5 Replies

Forum D Saiya (Employee) (212 Points)
Replied 27 July 2012

Hi u can refer the mentioned link as it is clearly mentioned and very nicely explained

/articles/holding-company-subsidiary-company-the-companies-act-1956-13954.asp

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Aviral (finance) (77 Points)
Replied 27 July 2012

Originally posted by : Ms.Joshi
	Hi Kindly help me in understanding the foll Concept. 1) how can a company becomes Holding and Subsidiary company by voting rights??.company is having equity and preference shares .both. pls help. Regards Joshi Refer clause 32 of sebi and AS 21

Mrs.n (CS, LL.B ) (407 Points)
Replied 27 July 2012

Thanks forum and aviral for yr prompt reply.

in my case it is private company and further wants to know if there no pref.shares are involved , how to find the relationship of Holding -subsidiary through voting right.

pl.suggest

regds

joshi

Forum D Saiya (Employee) (212 Points)
Replied 27 July 2012

A holding company is a corporation that is organized for the purpose of owning stock in other corporations. A company may become a holding company by acquiring enough voting stock in another company to exercise control of its operations, or by forming a new corporation and retaining all or part of the new corporation's stock. While owning more than 50 percent of the voting stock of another company ensures control, in many cases it is possible to exercise control of another company by owning as little as ten percent of its stock. I think so it must just have Equity shares i m not sure about it.I u want u can refer https://www.enotes.com/holding-companies-reference/holding-companies and https://220.227.161.86/19330sm_finalnew_cp5.pdf