Definition of Holding

It is known as holding (holding company or parent company) the organization or group of companies in which one of them owns all or most of the shares of another company or company with the aim of exercising total control over it. There are holdings that are created with the help of banks and other financial entities, family assets or state companies.

In other words, holding companies own the shares of other companies in order to maximize their income through capital gains, without intervening in the production of goods and services of the companies in which they participate.

Advantages of a holding

The creation of a holding company has both business and tax advantages. We review below some of the advantages of the most important holding companies:

  • It allows to reach more sectors of the market
  • Provides greater ease of integration to exercise control of all parts of the product or service life
  • Eliminate fiscal and economic inconveniences for groups of companies
  • Allows expansion through fractional ownership in various companies
  • Diversify responsibility
  • It allows to control a company without having to have all of its capital

Know all the information about holding and its characteristics so that you can decide if you are interested in using this management model for your business.

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