Subject category:
Strategy and General Management
Published by:
IBS Case Development Center
Length: 13 pages
Data source: Published sources
Topics:
Spin-off, Equity carve-outs, Tracking stock; Restructuring through spin-offs; General Motors, Ford, Delphi, Visteon; AT&T, General Electric, Genpact; Strategic rationale; Operational and financial transparency; Accountability and incentives; Shareholder value; Semiconductor Products Sector (SPS); Asset light strategy; Branding strategy; Product development strategy; Michel Mayer; Merck, Medco, McDonald's; Cendant, Viacomm
Share a link:
https://casecent.re/p/66289
Write a review
|
No reviews for this item
This product has not been used yet
Abstract
There are varied reasons as to why companies opt for spinning-off their business divisions or subsidiaries. Sometimes spin-offs unlock hidden shareholder value or they are merely a means to separate a troubled unit from the parent company. In a competitive landscape for a spun-off company to succeed as an independent entity, the timing of the spin-off and the status of the spin-off''s relationship with its former parent company, are important factors. Corporate history is replete with examples of spin-offs that have spectacularly failed to achieve their touted potentials. At the same time, there are those that have performed far beyond market expectations. This case study, while showcasing Motorola''s spinning-off of its semiconductor subsidiary, Freescale, provides scope to discuss the underlying formula that enables a spin-off company to thrive as an independent entity.
About
Abstract
There are varied reasons as to why companies opt for spinning-off their business divisions or subsidiaries. Sometimes spin-offs unlock hidden shareholder value or they are merely a means to separate a troubled unit from the parent company. In a competitive landscape for a spun-off company to succeed as an independent entity, the timing of the spin-off and the status of the spin-off''s relationship with its former parent company, are important factors. Corporate history is replete with examples of spin-offs that have spectacularly failed to achieve their touted potentials. At the same time, there are those that have performed far beyond market expectations. This case study, while showcasing Motorola''s spinning-off of its semiconductor subsidiary, Freescale, provides scope to discuss the underlying formula that enables a spin-off company to thrive as an independent entity.