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Definition

parent company

Contributor(s): Ivy Wigmore

A parent company, sometimes called a holding company, is a corporation that has subsidiaries, which are wholly or partially-owned separate businesses controlled by the parent.

Although corporate law varies from one country to another, a parent company usually must have at least 50% of a subsidiary's voting stock for control of operations and management. A wholly-owned subsidiary is one in which the parent owns 100% of the stock. 

Parent companies with subsidiaries are one type of conglomerate, which is a company comprising multiple different businesses. Holding companies, which exist to own subsidiaries but do not have their own business ventures, are one type of parent company.

This was last updated in March 2013

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