If a company buys another company, does the bought company become a subsidary company of the other company?
- Don GLv 71 month agoFavorite Answer
If the bought company continues as a separate company, then it is a Subsidiary. But if the bought company's assets and liabilities are combined with the parent, and its Equity accounts are closed, then it no longer exists.
- A.J.Lv 71 month ago
There are many possibilities in mergers and acquisitions. It can be held as a subsidiary as one option. Some companies in China were doing reverse mergers buying listed shell companies on US Exchanges and making that company the primary one, doing a secondary offering. If you ask about all of the possible options, it could be a big list.
- SlumlordLv 71 month ago
They can be structured however the purchasing company wants. Sometimes they are a subsidiary if the 2 companies do completely different stuff. If the companies were direct competitors then the purchased company might be rolled into the new company.
- PearlLv 71 month ago
some of them might become that
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- RickLv 71 month ago
Can, or the owner may just absorb it ................