SUBSIDIARY COMPANY Meaning and
Definition
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A subsidiary company refers to a business entity that is partially or entirely owned and controlled by another company, usually referred to as its parent or holding company. The subsidiary company exists as a separate legal entity from its parent company, with its own management, assets, and operations. The purpose of establishing a subsidiary is for the parent company to extend its business activities, diversify its operations, or gain a competitive advantage in a particular market or industry.
The parent company typically owns a significant percentage of the subsidiary's shares, providing it with controlling interest and decision-making power. However, it is not uncommon for the subsidiary to have minority shareholders or publicly traded shares. The parent company's ownership enables it to exert influence over the subsidiary's strategic direction, financial decisions, and overall management, often aiming to enhance synergies and maximize profits.
Subsidiary companies can operate in various sectors or geographic locations, offering products or services complementary to their parent company. By establishing a subsidiary, the parent company can benefit from economies of scale, reduced risk exposure, increased market share, or tax advantages in certain jurisdictions. In addition, a subsidiary company provides the parent company with flexibility to spin off or divest specific business units, ensuring a focused approach in different markets or industries.
Overall, a subsidiary company serves as an opportunistic means for a parent company to expand its scope, leverage resources, and enhance its overall competitiveness in the business landscape.
Common Misspellings for SUBSIDIARY COMPANY
- aubsidiary company
- zubsidiary company
- xubsidiary company
- dubsidiary company
- eubsidiary company
- wubsidiary company
- sybsidiary company
- shbsidiary company
- sjbsidiary company
- sibsidiary company
- s8bsidiary company
- s7bsidiary company
- suvsidiary company
- sunsidiary company
- suhsidiary company
- sugsidiary company
- subaidiary company
- subzidiary company
- subxidiary company
Etymology of SUBSIDIARY COMPANY
The word "subsidiary" originates from the Latin word "subsidiarius", which was derived from "subsidium". "Subsidium" means assistance, help, or support. The term was formed by combining the prefix "sub"-, meaning under or below, and "sedere", which means to sit or settle.
The use of "subsidiary" in English dates back to the early 17th century, where it originally referred to a person or thing that provided assistance or backup to someone or something else.
The word "company" has a different origin, stemming from the Old French word "compaignie", which was derived from the Latin word "companionem", meaning companion or associate. It generally referred to a group of persons associated together for a particular purpose.
Similar spelling word for SUBSIDIARY COMPANY
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