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system
can two companies own stock in each other?
user
absolutely. in fact, all stock purchases of more than 5% of a company's stock must be reported to the sec, so assuming a and b are publicly traded companies in the us, the purchase would likely be a matter of public record.  there are probably special cases where this could cause problems, however; any case where a's purchase of b's stock (or vice versa) runs afoul of regulation would be one such case. for example, if company a wants to own a controlling interest in company b and appoint members of its board of directors and both companies were in the same heavily-concentrated market, regulators may frown on the potential for decreased competition. such regulations may apply to any purchase of a controlling interest in a company, though.
assistant