What does Minority Interest mean?
Minority Interest represents accumulated interest for minority shareholders in subsidiaries that are less than 100 percent owned by the reporting parent company. The net worth of a subsidiary is assumed to be proportionally owned by parent company and other minority shareholders according to their respective ownership percentage. Minority shareholders’ interests may be reported between the liability and shareholders’ equity sections, but Thomson Reuters includes it in the liability section.
Stockopedia explains Minority Interest...
This is the amount of a balance sheet not owned by a firm’s shareholders. This arises because of the way two companies’ balance sheets are combined when one buys the other. Say, for example, A plc buys 65% of B plc. A now controls B so, in a ‘consolidated’ balance sheet, you combine 100% of the assets that A now controls. However, 35% of the net asset value of B plc is shown as a “minority interest” as it is technically owned by external shareholders.
