Managing Director & Senior Partner; Global Leader of Mergers & Acquisitions
Companies thrive by expanding, not shrinking. Yet shedding assets can create substantial benefits. The crucial factor: handling divestitures adeptly. BCG delivers strategic and financial insight throughout the divestiture process, enabling both the parent and the new business to succeed.
The time frames for divestitures usually range from 6 to 12 months, and the choices are seemingly straightforward: an IPO to new investors, a trade sale to an industry player or a private equity firm, or a spinoff to existing investors. Yet decisions about which route to pursue—along with when, how, and with whom—can be exceptionally complex.
BCG’s divestiture consulting supports management throughout the demanding separation process. Our deep industry expertise and immersion in our clients’ businesses enable us to assist you in creating a divestiture strategy that extends from an initial portfolio review through the wrap-up of the optimal deal.
BCG has a record of successful divestitures in every major industry, and our clients find that involving us can unlock substantial value. We understand how to identify prospective buyers and assess businesses beyond the obvious metrics, which can shift your targets and maximize what they’re willing to pay. And by working shoulder-to-shoulder with clients, we free you to focus on what matters most: your core business.
Our highly tailored approach is the antithesis of a business divestiture checklist. We deliver end-to-end support for the corporate divestiture process and deal execution in two broad categories: creating the case for a divestiture and unlocking value during the exit process.
Phase 1 of our divestiture process covers everything from a portfolio review of ripe prospects to the creation of an exit strategy, including operating upgrades to boost the value of the assets being sold.
Phase 2 involves preparing for and conducting the actual sale. A corporate divestiture usually starts with a carve-out, or surgical separation of the unit from its parent. Too often an afterthought, carve-outs require careful oversight to avoid costly value leakage.
In this phase, BCG also helps build two key elements: an equity story with a compelling investment rationale and a detailed, substantiated business plan tightly linked to targeted high-value operational improvements.
In the case of a trade sale, we conduct intensive vendor due diligence to deliver an independent assessment that can guide prospective bidders’ decisions. Our objective, highly reputable opinion of a unit’s value and prospects raises the confidence of would-be buyers—and often the price they’re willing to pay.
Finally, we support you throughout the divestiture agreement process and interaction with bidders to close the optimal deal.
Our divestiture consultants help clients maximize the value of their deals while enabling their core business to thrive. Here are some of our divestiture experts.
M&A, Transactions, and PMI Services
BCG has deep expertise in a multitude of industries, with comprehensive knowledge of all aspects of M&A activity and post-merger integration, to help you realize the full value of your transaction.
Many companies are eyeing divestitures in the current environment. Are they likely to create value? What is the best path to success?
No matter how advanced the negotiations, both buyers and sellers can take certain steps to improve deal execution. Creative thinking and agile ways of working are critical.