₦airaland Forum

Good one

Good news.

Hopefully, this works out.

HOLDING COMPANIES

A holding company is a parent company that has more than half (50%) of the shares in another company in order to control its policies and management. The main purpose of holding company is to control the ‘daughter’ company. Where the parent company owns 100% of the shares of a daughter company, it is called a ‘wholly owned subsidiary’.
An example of a Holding company in Nigeria can be found in most commercial banks, following a directive of the Central Bank of Nigeria which stipulates that all deposit banks in the country should divest their non - core banking subsidiaries and consolidate into a holding company.
The law prohibits the use of the word ‘Holding’ accordingly, requisite consent must be obtained from the Registrar-General of the CAC before the word can be included in the name of a company.

The procedure for registration of a holding company is as follows:

1. Payment of non-refundable application for consent fee.

2. Formal application for consent to use the word ‘Holding’.

3. Evidence of not less than 2 subsidiary companies.

4. Statement by majority of the directors of the proposed holding company that the company shall acquire more than half in the nominal value of the share capital of each of the subsidiaries within 90 days of incorporation.

5. Evidence of updated annual returns of all subsidiary companies

6. Evidence of appointment of company secretary of each subsidiary company.

7. Evidence of compliance with S.553 CAMA where applicable. This applies to banks, insurance firms, deposit, provident or benefit societies.

After consent is successfully obtained for the use of the word ‘Holding’, the new entity which is the parent company can then be registered in accordance with the usual company registration procedure.

Registering a holding company does not differ much from the normal Limited Liability Company registration.

SIMILARITIES:

- LLC registration and Holding Company Registration have nearly identical processes.

- There is no minimum share capital

- Both have company directors and a company secretary.


DIFFERENCES:

- A holding company has at least 2 subsidiaries.

- Private Limited Companies (LTD) are the only acceptable subsidiaries.

- The holding company must have a majority share in the subsidiary.

- Business Names are not an acceptable subsidiary.

- The holding company utilises group, conglomerate, or holdings in its name.

- A holding company requires consent to use the word “Holdings”


GROUP OF COMPANIES

Another form of a holding company is a group of companies comprises. It consists of a minimum of three companies that all have common shareholders and similar names. These companies will in turn become the shareholders of the Group Company. An example of a Group Company in Nigeria is Dana Group. Its associate companies in aviation, plastics, pharmaceuticals, automobiles etc.
Just as with holding Companies, the use of the word ‘Group’ in the name of a company is prohibited by the law, unless consent is sought and the application granted by the Registrar-General of the Corporate Affairs Commission (CAC) before the word can be used.
The following requirements must be met in the process of registration of a Group Company:

1. Payment of a non-refundable application for consent fee.

2. Formal application for consent to use the word ‘Group’.

3. Evidence of not less than 3 associate companies to form the proposed Group company which will be a distinct entity.

4. Similar names of associate companies and evidence of similar ownership or shareholdings of the associate companies.

5. Resolution of the associate companies indicating consent to the ‘Group’ relationship

6. Updated annual returns of all associate companies.

7. Evidence of Company secretary of associate companies.

8. Statement by the majority of the directors of the proposed Group company that the share capital shall not be less than the highest share capital amongst the associate companies.
For an illustration of this point, let us assume that there are 4 associate companies as follows: Company A Limited with share capital of N1m, Company B Limited with share capital of N1m, Company C Limited with share capital of N2m and Company D Limited with share capital of N5m. The share capital of the proposed Group of companies cannot be less than N5m.

9. Evidence of compliance with S.553 CAMA where applicable. This applies to banks, insurance firms, deposit, provident or benefit societies.

After consent is successfully obtained for the use of the word ‘Group’, the new entity which is the Parent/Group Company can then be registered in accordance with the usual company registration procedure.

At Oak Consults, we ensure you get the best of corporate representations. We assist you in the registration of your business, company, church and other associations.

Contact: 08060073853
oakconsult.nig@gmail.com

Okay

Interesting..

Another side of the story

Congratulations to her..

Hilarious... Politics in Nigeria has gradually shifted from extreme bitterness to simple comic reliefs and jibes at each other.

So sad..

Good list though..

Easier said than done..

Interesting..

Lovely..

Hope the government looks into this.