What happen if a subsidiary goes to bankrupt?
Nothing ... your man company goes on living, and will get any money back left over after paying leases, wages, and returning deposits. But f it is a bankruptcy I guess there will be no money left to go to the holding.
If the subsidiary owns any plane 100% paid for, you should transfer it to holding company through an asset management tool before the bankruptcy, or else you lose the plane.
Hi,
and what happens if the balance is negative ?
Imagine that your subsidiary borrows a lot of money, transfers that money to the holding, and then goes bankrupt. Does the holding have to cough up the losses of the subsidiary ? Or is the holding allowed to keep the money ?
In my opinion, holdings should have to pay for the losses of the subsidiary.
Jan
Hi,
and what happens if the balance is negative ?
Imagine that your subsidiary borrows a lot of money, transfers that money to the holding, and then goes bankrupt. Does the holding have to cough up the losses of the subsidiary ? Or is the holding allowed to keep the money ?
In my opinion, holdings should have to pay for the losses of the subsidiary.
Jan
In reality, a subsidiary has separated identity from its own mother company, which the holding has no liability to the subsidiary.
Hi,
true enough.
But in reality, I shall go to jail if I my subsidiary borrows money from the bank, gives the money to the holding and then goes bankrupt. In Dutch it is called "bedrieglijk bankroet"... don't know how that translates.
Jan
Mrs. Google tells me:
fraudulent bankruptcy
and in german (very easy as it is very close to the dutch words)
betruegerischer Bankrott
Thank you :-)
I would like to know how can I borrow a lot of money with the subsidiary and then transfer it to a holding
well I know how to transfer it,... but please tell me how to borrow it :) When a company (any, holding, subsidiary, etc.) is able to borrow money, it can do so because it has a strong rating ... so would not be at the brink of bankruptcy. I think one excludes the other one.
Edited: At subsidiary that has been running for some quite time, has AAA rating and is VERY profitable:
The lender do not consider loan requests from this enterprise to be appropriate at this time.
Profits don't matter. Assets do.
... but please tell me how to borrow it :) When a company (any, holding, subsidiary, etc.) is able to borrow money, it can do so because it has a strong rating ... so would not be at the brink of bankruptcy. I think one excludes the other one.
Hi,
you're also playing on Tempelhof. Check out my Lebanese subsidiary. It owns more than a billion dollar in planes. That means I can probably borrow 500 million. I could then transfer the money and the planes to my holding and delete the subsidiary.
Don't worry... it has taken me a month to schedule all the flights and I have no intentions to delete the airline. But that's why I wrote that holdings should pay the debts of their subsidiaries.
Jan
So, if you own a plane with the subsidiary and you transfer it to other of your companies before bankrupt, is it illegal? Is it punished in game?
No, it's not illegal. You're doing what most companies do when bankruptcy looms -- getting rid of assets, either to try to keep the company afloat, or to keep assets out of the government's hands.
On fornebu a major long time player liquidated several big subsidiaries because he had no time to attend to them ... transferred the planes to holding of course. I think he was making nice money because he was with AAA rating (if bankruptcy was looming it would be CCC after week end closing and rescue loan). So transferring planes to holding or other subsidiary before liquidating is not illegal per se.
(if bankruptcy was looming it would be CCC after week end closing and rescue loan)
I might be wrong on this, but I thought the rating was only updated when the airline CEO/owner checked the rating specifically, not when the rating changes.
I might be wrong on this, but I thought the rating was only updated when the airline CEO/owner checked the rating specifically, not when the rating changes.
You might be onto something because one of my airlines saw BBB change into AAA after clicking the Ratings link. But I thought it was just some system lag or something.
Well, it says it right on the ratings page: " The rating will be refreshed every time you reload this page. " I am just unsure if it actually refreshes per the information page or not.
I might be wrong on this, but I thought the rating was only updated when the airline CEO/owner checked the rating specifically, not when the rating changes.
That´s correct, good sir. :) The ratings also update when you apply for a loan, but other than that, they won´t change.
Hi,
I have four IL-18's on a route that seems to be very popular. I am basically bankrupt because no one is booking. Not even cargo. How am I supposed to make money? I can't afford to even lease a Q400! I'm stuck in the same situation and need help!
Hi,
I have four IL-18's on a route that seems to be very popular. I am basically bankrupt because no one is booking. Not even cargo. How am I supposed to make money? I can't afford to even lease a Q400! I'm stuck in the same situation and need help!
1. Restart company
- Change country
3. Change strategy
"... on a route that seems to be very popular. I am basically bankrupt because no one is booking."
that kind of contradicts itself.