Holding company and Subsidiary

This query is : Resolved 
 

(Querist)
05 November 2007

I want to ask what is the difference between holding and subsidiary company and what is the procedures to form such companies


KAAPIL (Expert)
05 November 2007

Holding Company and Subsidiary Company are explained in AS 21 and Companies Act Sec. 212.
Holding Company is holding company of the other if:
(a) Holds more than half the nominal value of shares
(b) Controls composition of majority of the directors of the other
(c) Voting of 20%

e.g. If reliance can appoint in X Limited 7 out of 12 directors

OR

e.g. Holds 51% shares

OR

Reliance owns voting power in X Limited 24%.

Ravikumar.G (Expert)
06 November 2007

Mr.Ankur please read out sec 4 of the companies act, 1956. There are lot of details are there with example. And also deemed public company concept will arise.

KAAPIL (Expert)
07 November 2007

If you want hard copy I will courier you on the address.



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