Corporate “Spin-Off” VERSUS “Split-Off” VERSUS “Carve-Out”


By Staff Reporters


In a spin-off, a company would distribute a number of shares to its investors. Each investor would receive shares of the new company for every share they owned.

In a split-off, investors would be allowed to directly trade none, all, or part of their owned shares. The exchange would likely retire outstanding shares for remaining investors. But investors must be convinced to voluntarily make that trade, so “sweeteners” are often included.

An equity carve-out, also known as a split-off IPO or a partial spin-off, is a type of corporate reorganization, in which a company creates a new subsidiary and subsequently IPOs it, while retaining management control





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