brand glossary: spinoff

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A corporate spinoff is the creation of an independent brand and business through the sale or distribution of new shares (via a separately-traded public company) of a subsidiary business unit or a piece of its business by a large or diversified company. The goal is to streamline for focused growth—for both the parent and the spinoff brand—in a strategic divestiture designed to increase capital and unlock shareholder value. Typically, a parent company distributes all of its ownership interest in a subsidiary business via a dividend to existing shareholders. Once the spinoff is complete, there are two distinct, publicly-traded companies. (Also known as a spin-out or split-off.)

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