Pyramiding Concentrating Control

Pyramiding Concentrating Control

Pyramiding, concentrating control over joint-stock companies by a series of controlling interests in holding companies and their subsidiaries. For example, a company with a capital of £200,000, hail in ordinary shares and half in fixed-interest shares, may be controlled by the ownership of £50,001 ordinary shares. An even smaller number of shares will suffice for effective control if the rest of the shares are widely held. The £200,000 capital might be employed to buy 50 per cent of the ordinary shares in a company with £800,000 capital, half in ordinary and hail in fixed-interest shares. The £800,000 night be used to buy 50 per cent of the ordinary shares in operating companies with capital Of £3,200,000, again half in ordinary and half in fixed interest shares. In this way the Van Sweringen brothers in the U.S.A. acquired control of railway assets exceeding ,000 million with an investment of less than million.

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