Divestitures: Creating Value Through Strategy, Structure, and Implementation

CHAPTER 4

Addressing Regulatory Requirements

INTRODUCTION

The preceding chapters analyzed three different roles that divestitures play in strategy: they remove problematic businesses resulting from industry unattractiveness or acquisition failure, they improve corporate focus when companies diversify too widely from their core operations, and they facilitate the reconfiguration of the corporate portfolio when used sequentially with acquisitions. Each of these motivations for divestitures underscores the strategic importance of these transactions, which is reflected in the positive shareholder returns that often accompany them.

In contrast, this chapter examines situations in which companies are mandated to divest certain assets or businesses ...