June 6, 2017
A new case study, Laying the groundwork for a complex divestiture, shows how a food company worked with PwC’s Deals team to plan for, develop and execute a carve-out in order to shed acquisitions that no longer aligned with the company’s business strategy.
This deal was particularly complex due to a new leadership team and limited visibility into the components they now wanted to carve out. PwC was able to collaborate closely with the leaders to explore the company’s many interconnections and the possible paths toward severing them in ways that would increase value while defining a robust carve-out.
PwC assembled a team of Deals professionals to analyze carve-out issues from each angle, including:
- Tax advisors to help address tax leakage and look at the tax implications that might arise from a potential loss on the sale.
- Accounting advisors to help the company develop the basis for both deal and GAAP financials for the carve-out.
- HR advisors to help deal with compensation, benefits, and transition issues.
With PwC’s help, company leaders were able to prepare, position, and present the carve-out business for sale. Discussions with more than 30 potential buyers soon led to a successful sale. Specifically:
- The company conveyed over $150 million in accretive value.
- Clawback tax exposure was reduced by $500 million.
- The sale was quickly and successfully completed, with no surprises.
We invite you to read the full case study to learn more about how this company and PwC used a clear, structured, and data-driven approach to carve out a stronger business strategy.