Laying the groundwork for a complex divestiture

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A large packaged foods company conquered tough legal, tax, and financial challenges in pursuit of the optimal carve-out deal.

Client challenge

Divest a significant piece of its business to align with business strategy

  • Recent acquisitions were not integrated successfully, synergies were not realized and strategic fit was in question.
  • Executive leadership was changing, and new leaders had new ideas about future strategies.
  • The company needed to reduce its overall cost structure and deal with complex tax issues inherent in the sale.

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PwC’s solution

Prepare and present a solid divestiture plan by:

  • Assembling a team of advisors across Deals, Tax, Finance, HR, and SG&A to analyze carve-out issues from every angle.
  • Teaming with company leaders to understand the financial realities of the carve-out entity.
  • Crafting a credible divestiture presentation to open the door to successful negotiations with potential buyers.

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Impact on client’s business

  • The company conveyed over $150 million in accretive value.
  • It reduced its clawback tax exposure by $500 million.
  • The sale was successfully completed, with no surprises.

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"PwC also helped the client reduce its clawback tax exposure by $500 million through careful analysis of tax structures and related regulations and envision using tax loss benefits to shield taxable gains on some of its other pending transactions."

Related business issues

Align costs with business strategy
Optimize deals
Transform human capital

Related business issues

Transform human capital
 

Related business issues

Transform human capital
 

Related business issues

Transform human capital
 

Related business issues

Transform human capital
 

Contact us

Curt Moldenhauer

Deals Sales & Marketing Leader, PwC US