Why are some companies called holding companies?

Why are some companies called holding companies? In today’s economic situation, social competition is also increasing day by day. Corporate managers must strengthen management in all aspects, including Only through the management of employees' behavioral standards, as well as the management of company shareholders and shares, can we gain a firm foothold in the market. Let's take a closer look at why some companies are called holding companies. Why are some companies called holdings 1

1. What is a holding company

1. A holding company refers to a company that controls a certain company by holding a certain number of shares. company. Holding companies are divided into pure holding companies and mixed holding companies according to their holding methods. A pure holding company is not directly engaged in production and operation business, but only conducts capital operations by holding shares in other companies. In addition to capital operations through holding, mixed holding companies also engage in some production and operation businesses.

2. The holding company not only has financial control over the subsidiary, but also has operational control, and has the right to decide on the appointment of important personnel and the determination of major policies, and even directly send people to Operations and management. Also called parent-subsidiary system.

3. A company that owns shares of other companies and can actually control its business activities is called a parent company, sometimes also called a head office; all or part of the assets are owned by the parent company, but economically and legally Companies that are independent from the parent company are called subsidiaries. With the extension of controlling rights, there is also Sun Company.

4. A holding company is different from an ordinary company. It is a collection of enterprises and is the result of the development of an ordinary company to a considerable scale. Because a company must have considerable strength to form a holding relationship with other companies. After the holding company is established, it will inevitably form a stronger economic entity than a single company. Therefore, the internationally famous large companies are basically holding companies. Some outstanding domestic companies are also developing towards holding operations.

2. Main types of holding companies

Pure shareholding companies

It does not engage in any actual business, but only purchases Stock control of other businesses as the sole purpose and method of operation.

Mixed shareholding company

It not only controls other companies by purchasing stocks, but also engages in certain business operations. The Bank Holding Company Act of 1970 in the United States stipulated holding companies in the U.S. banking industry. Any company that controls more than 25% of the equity of a bank is a holding company.

After World War II, holding companies in the U.S. banking industry developed extensively. The number of holding companies is increasing and their strength is also increasing. Many large banks in the United States have their own holding companies.

For example, the holding company of the First National Bank of Chicago was called First Company of Chicago. "Western Bank Corporation" in Los Angeles, USA, is also a well-known bank holding company. As early as 1974, it ranked 27th among the world's largest banks. It has assets of $18.3 billion and controls the majority of more than 20 banks in 11 states in the western United States. These bank holding companies do not engage in banking business themselves, but only aim to control bank stocks.

"Metric Corporation" is another type of large holding company in the United States. In the 1960s, its share capital was only more than 300 million US dollars, and the total capital of the 16 companies it controlled was But as much as 2 billion US dollars. Exxon is actually a holding company.

Its head office in New York only provides policy guidance and control to each branch, while various specific business activities are controlled by the American Exxon Corporation, Esso Orient Corporation, and Exxon Corporation under its control. Sen Chemical Company, Exxon Research and Engineering Company, etc. were conducted respectively.

Therefore, by establishing shareholding companies, financial capital can control and manipulate many other enterprises whose capital exceeds many times its own wealth, thus becoming an important means for financial capital to rule through participation.

3. Benefits of establishing a holding company

Establishing a holding company with financial capital has more benefits than directly establishing various enterprises:

1. It can be used Less capital, wider control.

2. The purpose of control can be achieved in a short period of time.

Because it is much easier and faster for a holding company to buy shares of an existing company than to create a new one.

3. You can make use of the business results that existing companies have achieved. Such as the market that has been developed and various business contacts, the signboards and trademarks that have been accepted by the public, the company's reputation, etc., thereby avoiding various difficulties in starting a business.

4. It can reduce operational risks. Since the investment of a shareholding company is dispersed across many enterprises, the business performance and profitability of the enterprise can often be equalized, thereby ensuring relatively stable profits, which is much safer than investing in and operating a certain enterprise alone.

5. Because shareholding companies combine many dispersed enterprises into one entity, they can often reduce the taxes payable.

6. Many legal controls or restrictions can be avoided. For example, when some local governments and countries prohibit foreign or foreign companies from setting up companies in their own region or country, shareholding companies can evade such legal restrictions by purchasing shares of local companies. Precisely because holding companies can often obtain these benefits, financial capitalists are happy to establish such companies. Why are some companies called holding companies 2

How to apply for the execution of equity interests in a holding company

The start of equity execution comes from the application of the person applying for execution. The execution of equity occurs in the process of civil enforcement, and civil enforcement requires the applicant's application. Without the applicant's application, the court will not initiate civil enforcement actions. This is because the execution of equity is essentially a civil act to deal with private rights between equal civil subjects.

The basis for equity execution is effective legal documents. Equity execution must be to fulfill the payment obligations determined by a court judgment or other enforceable legal documents before the equity owner can be forced to transfer his or her equity; otherwise, the shareholder cannot be forced to transfer his or her equity.

The content of equity enforcement is to take compulsory measures against the shares of other companies held by the person subject to execution. In equity enforcement, the people's court forces the transfer of equity. The law stipulates that only the People's Court has the right to enforce enforcement, and other judicial organs cannot exercise this right. Judging from the will of the equity owner, he may not be willing to transfer the equity, but in order to fulfill the judgment, he has to transfer his equity under the force of the people's court.

The target of equity execution should be the entire content of the equity. Equity has self-benefit rights and ***benefit rights. Some people believe that the execution of equity can be the content of self-benefit rights in equity. However, in the execution of equity, the equity that is executed should be the entire equity, that is, it includes both the self-benefit rights in the equity and the exclusive rights in the equity. Because only in this way can the interests of creditors or equity transferees be truly protected

. Just imagine that if you only exercise the self-benefit rights in the equity, the creditors or transferees will not be qualified to exercise the self-benefit rights. When the original shareholders fail to exercise their rights, it may be difficult for the creditors or transferees to realize their interests; When executing the equity rights in equity, on the one hand, the transferee or creditor has no right to claim benefits, so the execution of the equity loses meaning; on the other hand, because the transferee or creditor has no right to claim benefits, there is no exercise. ***The enthusiasm of equity rights. Therefore, when the equity is executed, all contents of the equity must be executed together.

The consequence of equity execution is that the shares will be transferred in accordance with the law. Equity execution is a form of equity transfer, which results in the transfer of shares. Equity transfer in a broad sense includes equity execution. When the people's court enforces the equity, it must be carried out in accordance with the law. The transfer must comply with the legal provisions on equity transfer; for example, the equity transfer of a limited liability company must be approved by more than half of the shareholders, and shareholders under the same conditions have the right of first refusal, etc.

If the execution of equity violates relevant legal provisions, there will be no legal consequences for the transfer. After the equity is executed, there will ultimately be two possibilities: either the person applying for execution will receive the shares held by the person subject to execution and enjoy the equity, and the person subject to execution will lose shareholder rights; or someone else will obtain the person subject to execution by providing consideration to the person applying for execution. of equity.

Why are some companies called holding companies 3

Why are unlisted companies also called holding companies?

Holdings only control the shares of the following companies, and have nothing to do with listing! The basic process of enterprise listing Generally speaking, if an enterprise wants to be listed on the domestic securities market, it must go through three stages: comprehensive evaluation, standardized reorganization, and formal launch. The main work content is: the first stage of comprehensive evaluation before the enterprise is listed. Enterprise listing is a Compared with traditional project investment, complex financial engineering and systematic work also need to go through the process of preliminary demonstration, organization and implementation, and post-period evaluation; and they also have to face whether to list on the capital market, which market to list on, and whether to list on the capital market. path selection.

Listing in different markets requires different tasks, channels and risks. Only through a comprehensive assessment by the company can we ensure that the company to be listed operates correctly while keeping costs and risks under control. For enterprises, there is a price to pay for organizing and mobilizing a large number of people and mobilizing all forces and resources to carry out work.

Therefore, in order to ensure the success of the listing, the company will first comprehensively analyze the above issues, conduct comprehensive research and prudently come up with opinions, and only then fully start the work of the listing team after obtaining clear answers. In the second stage, there are hundreds of key issues involved in the internal standardization and restructuring of enterprises and the initial listing of enterprises

Especially in the current specific environment in China, private enterprises generally have many financial and tax issues. , laws, corporate governance, historical evolution and other historical issues, and many issues are very difficult to deal with in the later stage. Therefore, companies must have plans and steps based on completing the early assessment and with the assistance of listed financial consultants. It is very important to deal with some issues in advance. Through this work, it can also enhance the confidence of sponsors, strategic shareholders, other intermediaries and regulators in the company.

The third stage officially starts the listing work. Once the company determines the listing goal, it begins to enter the practical operation stage of the external work of listing. This stage mainly includes: selecting relevant intermediaries, carrying out joint-stock reform, auditing and legal investigations. , Brokerage guidance, issuance declaration, issuance and listing, etc.

Because the listing work involves five or six external intermediary service agencies working at the same time, involving dozens of people. Therefore, organizational coordination is very difficult and requires coordination from multiple parties.