Hey Pakhee! If a question asks you to write the difference between Holding Company and Subsidiary Company, here’s a neat, simple way to answer it in a tabular/difference form:
Difference Between Holding Company and Subsidiary Company
Aspect
Holding Company
Subsidiary Company
Definition
A company that holds majority shares/control in another company.
A company controlled by the holding company through majority shares.
Control
Has control over the subsidiary company.
Is controlled by the holding company.
Ownership
Owns more than 50% shares in subsidiary.
Majority shares are owned by holding company.
Function
Controls policies, management, and decisions of subsidiary.
Operates as an independent company but under holding company’s influence.
Example
Parent company owning other companies.
Company owned and managed by holding company.
If you also want to include Associate Company for comparison, here’s a quick addition:
Aspect
Associate Company
Definition
A company in which another company has significant influence (usually 20%-50% shares) but not control.
Control
No control, only significant influence.
Ownership
Holds 20%-50% shares (equity participation).
Function
Independent company with some influence from the investor company.
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