The advantages of establishing a holding company

1. Holding company and its advantages

2. Introduction You should definitely consider the option of a holding company. Before jumping in, you have to understand the basic structure of a holding company and its advantages.

3. Holding company • A holding company is a business enterprise that does not engage in any activity or operations. • It is created with the sole purpose of buying shares of other companies and making them its subsidiaries. • The assets of the subsidiary company are used by the parent holding company.

4. Limited risks • It is not in any way liable for the risks of the subsidiary. • For example, there is a lawsuit against one of your subsidiary companies, • If the plaintiff wins they can only attach the assets of that particular company, the parent company is not dragged into this.

5. Less investment and more control One of the major benefits of being an owner of a holding company is that you can gain major control with minimum investment. if it is a diversified company, the holding company only needs around 25% of the shares to gain ownership.

6. Pooling resources You have access to the various resources and skills of the different business groups in Dubai. The skills and contacts of one subsidiary can be used to further the business of another subsidiary. For example, if one subsidiary has good customer relationships, this can be used to expand the sales of other subsidiaries.

7. Opportunity for growth The subsidiaries can invest and grow without being worried about risks. They can leap and bag big projects with more confidence. And if something does not work out, the holding company can quietly exit the deal. You have access to the various resources and skills of thedifferentbusiness groups in Dubai.

8. Centralized control The directors of the holding company form the core management team. With such a consolidated structure, all the subsidiaries achieve their full potential. For example, a holding company may be able to gain more favorable financial services for the subsidiary, as compared to if they were operating alone.

9. Future planning A holding company can confidently make future plans since it has a cohesive core management team. If any top member of the subsidiary leaves, the plan remains intact. Dubai city is a sprawling industrial complex and investing your resources to become a holding company in UAEwill be a very wise business move.