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Value creation of spin-offs and carve-outs

Rüdisüli, Roger. Value creation of spin-offs and carve-outs. 2005, PhD Thesis, University of Basel, Faculty of Business and Economics.

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Official URL: http://edoc.unibas.ch/diss/DissB_7179

Abstract

This study investigates whether 1074 spin-offs and 803 carve-outs occurring in Europe
and the USA between 1990 and 2003 create value. There is a robust positive market
revaluation of roughly 1.0% to 3.0% for firms announcing a spin-off or carve-out of a
subsidiary. This effect is similar for carve-outs and spin-offs, despite their different natures.
Hence, the analysis on the long-term implications of spin-offs and carve-outs consequently
unveils substantial differences: While the average spin-off firm outperforms
the market, carve-outs considerably underperform. Over time it becomes obvious that
spin-offs improve the business itself thanks to the increased independence and the focus
on the core business, whereas managers time carve-outs and use them primarily as a
cheap mean of funding, one that does not improve the business.
Advisors:Zimmermann, Heinz
Committee Members:Drobetz, Wolfgang
Faculties and Departments:06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften > Department of Finance > Finanzmarkttheorie (Zimmermann)
Item Type:Thesis
Thesis no:7179
Bibsysno:Link to catalogue
Number of Pages:270
Language:English
Identification Number:
Last Modified:30 Jun 2016 10:41
Deposited On:13 Feb 2009 15:13

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