Definition and Examples
- Definition
- A carve-out divestiture is a corporate action in which a company partially divests a business unit, division, or subsidiary by selling a minority stake, often through an initial public offering (IPO). The parent company retains majority ownership and control of the carved-out entity, while the new shareholders hold a minority stake. Carve-out divestitures are typically executed to raise capital, unlock value, or allow the separated entity to focus on its core competencies while maintaining a strategic relationship with the parent company.