Insight

Managing A Successful Corporate Spin

Unlocking shareholder value as firms reshape portfolios

Abs Kotulski

Abs Kotulski

Principal, Advisory, Strategy - TE, KPMG US

+1 212 954 1733

Irene Signorino

Irene Signorino

Director Advisory, Strategy, KPMG US

+1 213-955-8651

Corporate spin-offs can unlock significant shareholder value as companies look to reshape their portfolios or give divisions a better opportunity to grow independently. Over the past 15 years spins have represented a small fraction of all divestitures, but spin values are typically 7-10x larger on average than typical divestitures. They are also more complex and require more effort than a normal sale, as the parent company must separate the business ahead of its public debut. This paper provides examples of recent spins for context, and highlights how a company can manage the complexity, execute a smooth spin, and enhance the success of both the spin and the parent company.