subsidiaries
Definition
A subsidiary is a company that another company (called the parent company) owns and controls, either fully or partially. Think of it like a parent company having children companies underneath it, where the parent calls the shots and often owns more than half of the subsidiary's stock.
Example
If you own a bakery business and you create a separate company to handle your catering operations, that catering company becomes a subsidiary of your main bakery business.
Watch Out
Even though a parent company controls its subsidiaries, each one is legally its own separate entity, which means contracts, debts, and lawsuits against one do not automatically affect the others.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.