Larsen Ltd. has the following shareholders: Miller Co. - 60%
Sadaat Ltd. - 30%
Peterson Ltd. - 10%
Sadaat has two seats on Larsen's five-person board of directors. Which of the following statements is TRUE?

Question

Quizplus · Accepted Answer

According to the given information, Sadaat Ltd. owns 30% of Larsen Ltd. and has two seats on the five-person board of directors. This indicates that Sadaat has significant influence over Larsen, but not control, as it does not have a majority ownership or control over the board. Therefore, option D is the correct choice. Option A is incorrect as there is no indication that Larsen is a structured entity to Sadaat. Option B is incorrect as Sadaat does not have control over Larsen. Option C is incorrect as Sadaat's ownership and board seats suggest that it has more than just a non-strategic investment in Larsen.