parent company

Meaning

A parent company is a corporation that owns a controlling interest in another company, which is known as a subsidiary. The parent company usually owns more than 50% of the subsidiary's stock, giving it the power to influence or direct its operations and elect its board of directors. This structure is common in large multinational conglomerates.

Examples

• Alphabet is the parent company of Google and several other technology subsidiaries.

  Alphabet is the parent company of Google and several other technology subsidiaries.

• Although the brand operates independently, its parent company is based in Tokyo.

  Although the brand operates independently, its parent company is based in Tokyo.

• The subsidiary had to get approval from the parent company before launching the new product.

  The subsidiary had to get approval from the parent company before launching the new product.

• Financial losses at the subsidiary level can negatively impact the parent company's stock price.

  Financial losses at the subsidiary level can negatively impact the parent company's stock price.

• Our startup was acquired last year, but we still maintain a separate identity from our parent company.

  Our startup was acquired last year, but we still maintain a separate identity from our parent company.

Common Mistakes

• ✗ We need to report this to our father company.

  ✓ We need to report this to our parent company.

  In English, the controlling corporation is always called a 'parent company' or 'holding company,' never a 'father' or 'mother' company, despite literal translations from other languages.

• ✗ The parent company is owning 100% of the shares.

  ✓ The parent company owns 100% of the shares.

  State verbs like 'own' are generally used in the simple present tense, not the continuous form, when describing ownership status.

Related Expressions

Practice

• Instagram is owned by Meta, which acts as its ___.

  💡 The main company that owns other smaller companies.

  Show answer

  parent company

• Any major strategic decisions must be approved by the board of the ___.

  💡 The controlling corporate entity.

  Show answer

  parent company