1. Effective control can be achieved without 100% acquisition of the equity of the accused enterprise, or even half of the equity;
2. It doesn't need to notify the competent department of the merged enterprise, and it doesn't need to go through arduous negotiations, but it can usually buy shares in bulk. Therefore, it is the easiest way to achieve control;
3. All enterprises under the control of the investment holding company are legally independent economic entities, and they are completely independent of the holding company in economic responsibility, and there is no joint liability between them. Therefore, the risk responsibility of each enterprise in the holding company will not be passed on to each other.
5. Because all enterprises in the investment holding company are independent and need to declare and pay taxes separately, there is the possibility of repeated taxation.
In addition, the organization of investment holding companies is looser than that of merged companies.
From the perspective of company law, firstly, there is no concept of investment company in China's company law, which clearly stipulates that there are only two kinds of limited liability companies and joint stock limited companies. Therefore, as far as the classification of companies is concerned, there is no such category as investment companies.
Judging from the name of the company, the so-called investment holding company is generally based on economic and trade, and the scope of assets and business investment mainly depends on the business scope indicated in the company's articles of association.