closely held company


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Closely held company

A company who has a small group of controlling shareholders. In contrast, a widely-held firm has many shareholders. It is difficult or impossible to wage a proxy battle for any closely-held firm.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

closely held company

A firm whose shares of common stock are owned by relatively few individuals and are generally unavailable to outsiders. Also called closed corporation.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
This vesting may be a function of the term of employment, stock ownership, debt financing provided, or some other relationship with the closely held company. Therefore, unlike for an ESOP, such stock ownership rights may be forfeited if the contractual relationship with the company lapses.
An unrelated person would never pay more than a discount value for a minority interest in a closely held company. Why should the IRS arbitrarily expect more from a family member?
The strength of these sources lies in the fact they are almost always acquisitions of an entire entity, and the acquirer often has fiscal similarities to the closely held company being acquired and valued.
Selling--or buying--a closely held company is a tricky business.
The investors, in a complaint filed on Monday in federal court in San Francisco, claim the search-engine provider failed to tell them before May 10 that its $1 billion investment in Alibaba was "severely impaired" by the transfer of the payment business, Alipay, to a closely held company controlled by Alibaba Chairman Jack Ma.
Founded in 1971, IMC is a private, closely held company headquartered in Raleigh, NC.
HSPL is a closely held company with the promoters and promoter group holding 95% stake in the company as on 31st March, 2010.
The gift is from Phillip Ragon, chief executive officer of InterSystems Corp., a closely held company that sells software to hospitals.
In another case a wife's concern that the husband would default on an equitable distribution note made a collateral interest in his closely held company unacceptable.
(Possibly true, but how about an owner 15 miles away?) The users of closely held company audits do not seem to agree.
Thus, while the built-in capital gains discount was not equal to the full amount of the closely held company's potential capital gains tax liability, it was substantial (roughly 34% of the actual liability).
* In a family-held or closely held company, the dominant family member or largest shareholder may want to hold the chairman's post for monitoring reasons.