Divestments are an effective way to drive value, especially in today’s fast-paced market. With an increasing number of companies conducting portfolio reviews more frequently, this paper provides guidance on how to successfully prepare for the carve-out of a part of a business.
Since 2020, organisations have been steadily increasing their divestiture deal volume, driven, amongst other, by changes in the competitive environment, an opportunistic approach from third parties, and tax and regulatory changes.
When well executed, a divestment can reduce complexity, focus resources, and free up funds. However, carving out parts of the business is complex and requires thorough preparation to achieve the expected transaction value.
A well-defined separation approach is crucial. If it is set out at the start of the transaction process, it can enhance the asset value, attract more buyers, shorten transaction time, and facilitate smoother execution after closing.
It is also essential to get the deal perimeter right, identify the potential entanglements and address tricky decisions upfront. Not covering all the bases comprehensively can result in mistakes in valuation, significant rework, and prolonged negotiations.
We invite you to read our paper to learn more about how to achieve the full value of a transaction through thorough preparation and execution.