closed corporation

(redirected from Closely Held Companies)
Also found in: Dictionary, Thesaurus, Legal.

Related to Closely Held Companies: Public corporation, Privately held companies

Closed corporation

A corporation whose shares are owned by just a few people, having no public market.

Closed Corporation

A company in which a small group of shareholders controls the majority of the shares. These majority shareholders tend to hold on to the company's stock, and, for that reason, only minority shares are traded, leading to light trade volume. Closed corporations are, by their nature, resistant to hostile takeovers and proxy wars. They tend to be more stable than other companies because their share prices are not determined by (sometimes irrational) investment decisions, but by the value of the company itself. However, closed corporations do not have access to as much working capital as corporations with more shareholders. They are also called closely held companies.

closed corporation

See closely held company.

Mentioned in ?

References in periodicals archive ?

However, this mechanism is not available for closely held companies that issue ESOs.

Are your ESO values on target? Valuing employee stock options for closely held companies

For example, they should neither discriminate against, nor unduly favour, investment in closely held companies compared to investment in other firms.

Proposed reform of the "3:12 Rules"

Many nonpublic and closely held companies issue debt with an equity kicker, such as a warrant.

Debt issued with warrants

The company includes a consulting division that provides business valuations, expertise with mergers and acquisitions, estate planning and estate succession issues for closely held companies.

The GHP Financial Group

Through careful planning, high gift and estate taxes can be minimized for the owners of closely held companies.

A passing fancy: transferring a family business at less cost

There are several ways minority investors in closely held companies can ensure that they are able to participate in overseeing the material operations of the business and have a voice in making other significant business decisions.

Considerations for minority equity interest owners

Awarding ownership to employees can be a bit more complicated for small, closely held companies. The primary difficulty, says Andrewsen, is accurately assessing the value of company shares in the absence of a fair market value.

Owning up; Sharing the wealth can retain stellar employees

In closely held companies, employees who receive stock must be given an option allowing them to sell the stock back to the company for fair market value during the 60-day period following the distribution and again during the 60-day period following the first anniversary of the distribution date.

ESOP can provide a graceful exit strategy

Also, over time, closely held companies eventually sell, merge or go public, and the Simplot company was experiencing increased competition.

Tax Court bases premium for minority interest on percentage of company value

Another difference lies in the options for financing and structuring acquisitions for closely held companies. Stock-for-stock swaps are rare, and access to initial public offering funds or other large pools of money is limited.

M & A for smaller companies

Headquartered in Oakbrook Terrace, Illinois with offices in Atlanta, Boston, Chicago, Cedar Rapids and Louisville, the company is a leading advisor to closely held companies nationwide.

Prairie Capital Advisors sells Novaspect Holdings

Thursday, January 3, 2013, “New Medicare Tax Impact on Business Planning for Closely Held Companies - A National Perspective”

Illinois State Bar Association Law Ed Programs in January Center on Niche Legal Topics