Pure holding companies do not directly engage in production and operation business, but only carry out capital operation by holding shares of other companies. Hybrid holding companies not only carry out capital operation through holding, but also engage in some production and operation businesses.
Holding companies have not only financial control but also operational control over subsidiaries, and have the right to decide the appointment of important personnel and the determination of major policies, and even directly send people to operate and manage them.
Extended data
Characteristics of holding company
Have a considerable economic scale
Holding company is different from ordinary company, which is the aggregate of enterprises and the result of the development of ordinary company to a considerable scale. Because a company wants to form a holding relationship with other companies, it must have considerable strength. After the holding company is established, it will inevitably form a stronger economic entity than a single company.
Holding company is a kind of property right management organization commonly used abroad. It is different from ordinary enterprises directly engaged in commodity production, and it is not a simple product cooperation relationship or a cooperative relationship between enterprises. Instead, it mainly engages in the property management and operation of the company on the basis of equity relationship in the form of holding, equity participation or mutual shareholding, and promotes the commodity management of the group.
Holding company system is a very convenient and effective way to concentrate enterprises, that is, to form enterprise groups. Based on the ownership certificate-shares, the holding company not only enjoys the dividends of other companies, but also exerts influence on the decision-making of other companies according to the proportion of the majority shares it owns and exercises shareholders' rights.
The controlled company has legal person status.
Another important feature of the holding company is that the parent company and the holding subsidiary are independent of each other in legal form, and the director system is adopted on the basis of capital cooperation.
This is a major difference between the holding company and the business department system. Although the division system is a highly decentralized system adopted by large companies, each division generally cannot have its own personality. Holding companies are all independent legal persons, forming companies within the company, and each subsidiary is a completely decentralized profit management unit with independent management institutions, which are solely responsible for profits and have independent fund-raising ability.
Reference source Baidu Encyclopedia-Holding Company