A sister company is a business that has the same parent company as another business. The two companies may operate completely separately and only be related to each other because they are siblings – they share the same parent.
Put simply, sister companies are subsidiaries (daughter companies) of the same company.
The Fox News Channel, a US cable and satellite news television channel, is owned by Fox Corporation. Sky News, on the other hand, is owned by Comcast. They were once both once under the same parent company called 21st Century Fox. However, they are no longer sister companies after Disney acquired most 21st Century Fox assets and Comcast acquired Sky in 2018.
Sister companies may be quite different
Sister companies may not necessarily operate in the same business sectors. Their activities and products may be completely different.
Sometimes, sister companies may appear to be arch-rivals in a specific industry, but are owned by the same parent company. ConocoPhillips and Exxon Mobil, for example, compete aggressively in the oil & gas markets, but are both owned by Berkshire Hathaway Inc.
British multinational Virgin Group Ltd., which was founded by billionaire mogul Richard Branson and Nik Powell, today consists of many sister companies that operate in several sectors, such as telecommunications, media, food & drink, healthcare, transport and financial services.
Berkshire Hathaway Inc., led by Warren Buffett, is a major shareholder in companies such as Coca-Cola and American Express. It previously held a stake in ExxonMobil but no longer does. These holdings make them part of its investment portfolio, but not subsidiaries or sister companies in the traditional sense.
Some operate in the same sector
Germany’s automotive giant Volkswagen Aktiengesellschaft has several subsidiaries in the vehicle production industry, such as Audi, Bentley, Cupra, Jetta, Lamborghini, Porsche, SEAT, Škoda and Volkswagen.