When corporate breakup is a path to value creation

In today's global world, companies need to be agile and have a high level of competitiveness to ensure their continued existence. That is best obtained by having a focused business strategy. Thus, there are many examples of conglomerates divesting non-core business areas or splitting up into smaller companies to focus their efforts.

KPMG's research shows that conglomerates with financially disparate businesses obtain a lower valuation as investors assume a sub-optimal resource allocation. Divesting non-core activities can therefore lead to a higher overall valuation. Importantly, divesting can also create a financial buffer, which will be advantageous in withstanding the current looming recession.

Divesting and separating is a complex task requiring thorough planning and where previous experience is highly valuable. At KPMG, we assist our clients in conducting successful separations of companies and we have strong experience both on a Nordic and a global level.

You can read more by downloading the report below - and if you would like to hear more, you are also welcome to reach out to one of our experts.