What Is The Purpose Of Holding Companies…?
Holding Companies are actually formed to own the stock of a subsidiary organization. The “shell” of the holding company itself may not actually be worth anything from its operations, but its value is based on the operations of the actual operating entity. Debt is often held at the holding company level and the capital is then “lent” or “injected” into the subsidiary which then pays back the holding company. It is a way to maintain control and management of another organization.
