Holding on

We have a number of trading company clients who have ended up with a dormant holding company perhaps as the result of it being used as a management buy-out vehicle.

Because these companies now have no purpose or assets apart from the shares they hold in their respective trading company subsidiary the clients have asked whether it is possible to get rid of the holding company.

The most obvious answer would be to hive up the trade and assets of the trading company subsidiary to the holding company and then arrange for the now dormant subsidiary to be struck off. The difficulty with that is simply the logistics of conveying the assets and liabilities up to the holding company particularly where patents are involved leases have to be novated the approval of lenders sought and so on.

Where a hive-up is not practical presumably...