Madrid Ltd . has a 4 9 % holding in King Holding Company ( KHC ) ,
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Question:
Madrid Ltd has a holding in King Holding Company KHC which is located in a foreign country. KHCs business is to import goods from Madrid Ltd and sell them locally. Local laws do not permit foreign investors to hold a majority stake or to have a majority of board members on companies in that country. Thirty percent is held by a local investor, and the investment is funded by Madrid. A local entrepreneur, who is also the CEO, holds the remaining Madrid has a casting vote on decisions about the relevant activities. How should this investment be classified?
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