A:

In Germany, there are two types of companies: publicly traded and privately held.

The acronym 'GmbH', which is written after the name of the company, designates a company as private in Germany. The letters stand for Gesellschaft mit beschränkter Haftung which, translated literally, means a 'company with limited liability'. GmbH companies are incorporated and, as such, are legal entities unto themselves. These companies must have a minimum of two partners and may be, but do not have to be, owned by a public company.

German companies that are publicly traded are designated as such by the letters 'AG' after the company name. 'AG' is an abbreviation for the German word Aktiengesellschaft, which literally translates to 'corporation' in English.

The laws of a country determine which types of companies are legally recognized within the country's borders. One of the most commonly used acronyms is 'PLC', which is used throughout the United Kingdom to indicate a Public Limited Company, or a company that is publicly traded with owners having limited liability. Throughout the world, 'S.A.' is used to indicate a privately held company, though its meaning varies depending on the country in which the company is registered. The words translate broadly as 'anonymous society' in English.

More information on company extensions can be found at http://www.corporateinformation.com/defext.asp.

RELATED FAQS
  1. What's the difference between publicly- and privately-held companies?

    Privately-held companies are - no surprise here - privately held. This means that, in most cases, the company is owned by ... Read Answer >>
  2. What are some of the key reasons a large corporation might prefer to remain a private ...

    Understand the reasons why a large corporation would want to remain as private instead of going public through an initial ... Read Answer >>
  3. What advantages do corporations have over privately held companies?

    Learn about the chief advantages that publicly traded corporations have over other forms of business organizations, most ... Read Answer >>
  4. How does privatization affect a company's shareholders?

    The most recognized transition between the private and public markets is an initial public offering (IPO). Through an IPO, ... Read Answer >>
  5. What are the requirements for being a Public Limited Company?

    Discover the various different requirements that a company must meet in order to be recognized and traded as a public limited ... Read Answer >>
  6. Is a private company required to disclose financial information to the public?

    Understand whether a private company is required to disclose financial information to the public. Learn what is required ... Read Answer >>
Related Articles
  1. Term

    Advantages of Public Vs. Private Companies

    A privately held company is owned by its founder, management or a group of private investors.
  2. Investing Basics

    Why Companies Stay Private

    Many private companies prefer to stay private and find alternate sources of capital. Find out what firms have to gain by eschewing the windfall from a flashy IPO.
  3. Investing Basics

    How To Invest In Private Companies

    It can be tough to invest in a company that doesn't trade on an exchange, but there are also several advantages.
  4. Investing Basics

    What is a Private Company?

    A private company is any corporation that does not have shares publicly traded in the equity markets.
  5. Investing Basics

    How To Invest In Private Companies

    Owning a private firm means sharing more directly in the underlying firm’s profits.
  6. Investing News

    Public Vs. Private Tech Valuations: What's Driving the Divide?

    The gross valuations over the past five years are more indicative of the market than the true value of the company itself.
  7. Retirement

    IPO Basics: What Is An IPO?

    Selling Stock An initial public offering, or IPO, is the first sale of stock by a company to the public. A company can raise money by issuing either debt or equity. If the company has never ...
  8. Investing Basics

    What is a Public Company?

    A public company has sold stock to the public through an initial public offering (IPO) and that stock is currently traded on a public stock exchange.
  9. Investing Basics

    Explaining Privatization

    For a publicly traded company, privatization is the act of transitioning the company to ownership by private individuals.
  10. Options & Futures

    Why Public Companies Go Private

    Privatization can give management more time to make money for investors, but at what cost?
RELATED TERMS
  1. GmbH

    GmbH is an abbreviation of the German phrase Gesellschaft mit ...
  2. AG (Aktiengesellschaft)

    AG is an abbreviation of Aktiengesellschaft, which is a German ...
  3. Privatization

    1. The transfer of ownership of property or businesses from a ...
  4. Public Limited Company - PLC

    The standard legal designation of a company which has offered ...
  5. Ltd. (Limited)

    An abbreviation of "limited," Ltd. is a suffix that ...
  6. Reverse Takeover - RTO

    A type of merger used by private companies to become publicly ...

You May Also Like

Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center