Global corporate divestment study
An environment of low growth and volatility requires companies to adopt a strategic, structured approach to portfolio management.
Our research finds that only 18% of respondents complete divestments ahead of schedule and above price expectations.
To meet shareholder expectations and realize the maximum value from their assets, companies must carefully consider the performance of each component within their portfolio and assess whether it is aligned with broader strategic goals.
Divestments should form a core part of this process, helping companies to focus on assets where they are best placed to create shareholder value and shed those that can better be managed by others.
The Global corporate divestment study finds that appetites for divestments are growing, but it also reveals that sellers are sometimes poorly prepared or fail to explore all avenues to enhance the value story and expand the potential buyer universe.
The challenges of separation planning, including assessing stranded costs, tax structuring and closing mechanisms, can also easily be underestimated. These shortcomings mean that companies are frequently not deriving the maximum value from divestments, and also that transactions can take much longer than expected to complete.
Our research finds that only 18% of respondents complete divestments ahead of schedule and above price expectations. But our data also finds that those that do exceed expectations maintain a strong focus on the five priorities outlined in this report.
These companies are also better equipped to navigate today's uncertain economy.