In addition to the ownership of a sufficient percentage of outstanding common stock, significant influence can result by virtue of legal agreements and technology licensing.

Question

Quizplus · Accepted Answer

Usually, the investor company can exert significant influence over the activities of the investee company when it owns 20% to 50% of the voting stock of the investee company. An investor company might also exert significant influence if it is the sole customer or supplier of the investee customer, or has contractual rights.

In Addition to the Ownership of a Sufficient Percentage of Outstanding