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A company that is publicly-traded
but has more than half its stock
owned by another company, known as the parent company
. As long as the parent company owns more than half the stock, it maintains control of the subsidiary, though its other stock is still traded
. Some subsidiaries belong to the same industry as the parent company, while others do not, and are part of a diversification
effort on the part of the parent company. See also: Wholly owned subsidiary
subsidiary company a JOINT STOCK COMPANY that is owned by another company (the HOLDING COMPANY). Specifically a subsidiary company is one in which the holding company owns between 50% and 100% of the voting shares. The accounting results of subsidiary companies are consolidated (see CONSOLIDATED ACCOUNTS) in the annual accounts of the holding company. A subsidiary company is regarded as different from an ASSOCIATED COMPANY (where the holding company owns between 20% and 50% of its shares) which is less subject to the influence of the holding company and continues to produce its own annual accounts. A subsidiary company may continue to trade under its own name, but it is subject to control by the parent company.
subsidiary company a company that is owned by another company (see FIRM). A subsidiary company may continue to trade under its own name, but it is subjected to complete or partial centralized control by the ‘parent company’. See also HOLDING COMPANY, CONSOLIDATED ACCOUNTS.