A Limited Company Owning Another?

[FE]

Hope i explain this right

Ok i am currently the major shareholder and Manageing Director of my primary business which is a Limited company and has all the structure that surrounds.

I am about to embark on a secondary business but this time in a shared partnership. Teh new business will again be limited and a 50% share allocation.
My partner in this is also a Manageing director of his own buisiness but already has partners.

My questions are:

Is it possible for my primary business to own the 50% shares in the new company (which is totally seperate to the new). Is there any tax benefits / disadvantages to this as sure it will become a supplier in terms of office allocation, resource etc)

Is it possible to open a subsidery of the primary business as its own legal entity (limited) and appoint my partner as MD with a 50% shar holding (similar to the above is suppose)

Best to keep 100% seperate and both named as Directors in a totally seperate company

Sorry i know a lot of questions but hopefully they make sense just looking to consolidate and realise any benefits there may be to be had.

FE

[bwglaw]

Is it possible for my primary business to own the 50% shares in the new company (which is totally seperate to the new). Is there any tax benefits / disadvantages to this as sure it will become a supplier in terms of office allocation, resource etc)

Is it possible to open a subsidery of the primary business as its own legal entity (limited) and appoint my partner as MD with a 50% shar holding (similar to the above is suppose)

Best to keep 100% seperate and both named as Directors in a totally seperate company

Sorry i know a lot of questions but hopefully they make sense just looking to consolidate and realise any benefits there may be to be had.

FE

If I have understood your situation correctly you are looking to associate two companies together. A group of companies would form where there are at least 3 Ltd Companies.

Your primary company can own shares in other companies. The other company will need to issue shares in the name of your primary business.

Cannot comment fully on the tax advantages etc (someone here will) but the legal situation would be that if your primary business owns shares in another company and that company goes into difficulty then in some situations creditors of the failing company can seek remedy from your company's assets as the parent company, especially if it has a controlling share.

You can set up a subsidiary company and issue shares to the MD and run the business as you mention. This means the business would be entirely new and would have less risk in the event that the other company may have outstanding liabilities. This is what we have done with our companies.

Before going ahead with this transaction I would strongly suggest you get advice from a solicitor and have all the agreements drawn up, including a Director's Service Agreement, Shareholder's Agreement to protect your own interests.