Question

1. Are Alpha Corp and Omega Corp a parent-sub controlled group if Alpha owns 79% of...

1. Are Alpha Corp and Omega Corp a parent-sub controlled group if Alpha owns 79% of Omega’s voting shares? Why or why not?

2. Are Alpha Corp and Omega Corp a parent-sub controlled group if Alpha owns 85% of Omega’s voting stock? Why or why not?

3. Are Alpha Corp, Omega Corp and Zeta Corp a parent-sub controlled group if Alpha owns 100% of Omega’s voting shares and Omega owns 85% of Zeta’s voting stock. Why or why not?

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Answer #1

To be able to become a sub parent controlled group , at least 80% of Voting shares or 80% of voting stock must be acquired.

1) since acquired voting shares are less than 80% , they are not a parent sub controlled group.

2) since acquired voting stock is more than 80% , it is a parent sub controlled group.

3) Alpha corp directly owns 100% of omega's shares and indirectly ( through his sub. i. e. through omega) owns 85% of zeta's voting stock. Hence they are a parent sub controlled group.

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