I think the parent company misunderstood the process as being required to move to a new Google account. That's not the case as far as I can tell from the support document. The account remains the same, just have to pay for the service.

"How does the upgrade affect my current G Suite legacy free edition subscription?

Your current G Suite legacy free subscriptions and related services will continue to function as they do today, until you self-upgrade or we upgrade you automatically to one of the new editions."

That "until" is really ambiguous - does that mean services terminate when you self-upgrade?

No, it means that you upgrade to a paid Google Workspace account. If you don't want to pay for it you can cancel it: https://support.google.com/a/answer/1257646

If you cancel it, your account is converted to an ordinary external domain Google account AFAICT. You need to migrate your email out of Google/Gmail to get service messages over email, but you can continue using your Google account as an ordinary Gmail-like account - only difference being that you handle your email yourself (because you didn't want to pay Google to do it for you.)