subsidiary

Subsidiary

A company whose voting stock is more than 50% controlled by another company, usually referred to as the parent company.

Notes:

As long as the parent company has more than 50% of the voting stock in the subsidiary, it has control.

In the case of a foreign subsidiary, the company the subsidiary is incorporated under must adhere to the laws of the country in which it operates, although the parent company still carries the foreign subsidiaries financials on their books (consolidated financial statements).

See also: Acquisition, Consolidated Financial Statements, Hostile Takeover, Merger, Parent Company, Takeover, Wholly Owned Subsidiary

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Subsidiary

A wholly or partially owned company that is part of a large corporation. A foreign subsidiary is a separately incorporated entity under the host country's law. A subsidiary's financial results are carried on the parent company's books.

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subsidiary

A company controlled or owned by another company. For example, the trucking company Overnite Transportation is a wholly owned subsidiary of Union Pacific Corporation. If a subsidiary is wholly owned, all its stock is held by the parent company. Compare holding company, parent company.