Setting up a carve out for success: Business in a box part 1

Carve-outs have become popular among companies with different underlying businesses. Companies conduct carve-outs to increase strategic focus on their core business, to improve valuation, or to set up a different control structure and reduce bureaucracy. Market conditions have also been favourable for carve-outs, which has contributed to the high activity in the M&A market in the first half of 2022.

Although there are many good reasons for conducting carve-outs, it is a complex process. Simultaneously, there is currently a heightened risk in Europe because of the energy crisis, high inflation, increasing interest rates, and Russia’s war against Ukraine. Therefore, it is more important than ever to have a separation blueprint and separation plan to guide towards Day 1. In this article, we describe some of the common pitfalls to avoid in carve-out planning and which actions one should take to achieve success.

In KPMG, we have great experience with advising our clients in creating successful separations both on a Nordic and global level. If you would like to hear more, please reach out to one of our experts.