An industrial holding company is a corporation whose primary purpose is to hold and manage equity participations in other companies over the long term. Unlike a pure financial holding company, an industrial holding company often does not limit itself to managing equity participations but also supports its subsidiaries in strategic, organizational, or administrative matters.
In Italy, industrial holding companies are used in particular by entrepreneurial families and corporate groups to consolidate various operating companies under a single structure.
Typically, the industrial holding company holds shareholdings in several subsidiaries, which continue to operate independently in the market.
The structure might look like this, for example:
This structure allows business activities to be organized separately, succession planning to be prepared, and equity participations to be managed more easily.
Establishing an industrial holding company can offer various economic and organizational advantages:
From a tax perspective, industrial holding companies can be particularly attractive due to Italian regulations governing the taxation of investment income.
Dividends received by an Italian corporation from its shareholdings are generally 95% exempt from IRES taxation, meaning that only a small portion is included in the taxable income base. Under certain conditions, the so-called Participation Exemption (PEX) may also apply upon the sale of certain shareholdings.
While a pure holding company primarily manages shareholdings, an industrial holding company often assumes additional responsibilities for the corporate group. These may include, for example, central services, strategic planning, or support in investment decisions.
An industrial holding company can be a suitable tool for structuring and developing corporate groups over the long term. In addition to organizational advantages, there may also be tax implications. However, the specific structure depends largely on the structure of the shareholdings and the economic objectives of the corporate group.