Holding company: Difference between revisions

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{{Business administration}}
 
A '''holding company''' is a [[company (law)|company]] that owns the [[Shares outstanding|outstanding stock]] of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own shares of other companies to form a [[corporate group]]. However, in many jurisdictions around the world, holding companies are usually called parent companies, which, besides holding stock in other companies, can conduct trade and other business activities themselves. Holding companies reduce [[risk]] for the [[shareholder]]s, and can permit the ownership and control of a number of different companies.
 
Holding companies are also created to hold assets, such as [[intellectual property]] or trade secrets, that are protected from the operation company. That creates a smaller risk when it comes to litigation.