When a piece of your company no longer fits: What boards should know

Selling or spinning off a business can improve efficiencies and returns, but successful divestitures can be challenging.

 

 

Sometimes certain parts of a company no longer fit with the overall strategy. By separating, companies can focus on core capabilities and increase shareholder value. But what do directors need to consider before green-lighting a divestiture? Our paper explores the following questions: 

  • What is the goal of the divestiture? 
  • What kind of divestiture should be considered (carve-out IPO, spin-off, etc.)? 
  • Creating a separate company takes time. Is there a specific buyer in mind or will the business will be marketed to a range of possible buyers?
  • How will you handle talent?
  • What needs to be considered once the deal is done (e.g., stranded costs, transition service agreements)?

Contact us

Paula Loop
Leader, Governance Insights Center
Tel: +1 (646) 471 1881
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Catherine Bromilow
Partner, Governance Insights Center
Tel: +1 (973) 236 4120
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Michael Niland
US Divestitures Services Leader
Tel: +1 (678) 419 3586
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