Question
Thomas Ltd and Jackson Ltd own 80% and 20% respectively of the ordinary shares that carry voting rights at a general meeting of shareholders of
Thomas Ltd and Jackson Ltd own 80% and 20% respectively of the ordinary shares that carry voting rights at a general meeting of shareholders of Stanmar Ltd. Thomas Ltd sells half of its interest to Benson Ltd and buys call options from Benson Ltd that are exercisable at any time at a premium to the market price when issued and, if exercised, would give Thomas Ltd its original 80% ownership interest and voting rights. At the end of the current financial period, the options are in the money. Required: Discuss whether Thomas Ltd is the parent of Stanmar Ltd.
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