Hi Forum
Could anyone enlighten me on why several companies are used in a corporate hierarchy when say a new investment group buys a UK trading company. I notice that lots of buyers have about 3 or 4 holding companies between them and the target, each doing no more than holding the shares in the company below. Then they seem to make losses. I was wondering how do they get any dividends to the investors when each of them have negative retained earnings?
Any takers? from the corporate finance world perhaps?
Thanks all.