A holding company in Pakistan is a type of company that is established to own and control the shares of other companies. The purpose of a holding company is to own and manage a group of companies and to provide centralized management and financial control.
In Pakistan, a holding company can be formed as a private limited company or a public limited company, depending on the needs of the business. To establish a holding company, an individual or group of individuals must first incorporate a company and register it with the Securities and Exchange Commission of Pakistan (SECP).
Once the holding company is established, it can then acquire the shares of other companies. This can be done through the purchase of shares on the open market, or by negotiating a share transfer agreement with the existing shareholders of the target company.
Holding companies in Pakistan are subject to the same regulations and laws as other types of companies, including the Companies Ordinance 1984 and the Securities and Exchange Ordinance, 1969.
It is important to note that Holding companies are not allowed to carry out any business activities and their only purpose is to hold shares of other companies. They are also required to maintain separate accounts and books of accounts for each subsidiary company.
In summary, a holding company in Pakistan is a type of company that is established to own and control the shares of other companies. It provides centralized management and financial control and is subject to the same regulations as other types of companies in Pakistan. They can be formed as a private limited company or a public limited company and their only purpose is to hold shares of other companies.