The courage to shrink

《The courage to shrink》由会员上传分享，免费在线阅读，更多相关内容在学术论文-天天文库。

1、1AUGUST2011corporatefinancepracticeFindingthecouragetoshrinkSpinningoffbusinessescanhaverealadvantagesincreatingvalue—ifexecutivesunderstandhow.BillHuyettandTimKoller2Ittakescouragetobreakupacompany.CEOsandboardsofdirectorsoftenfearthatinvestorswillviewassetdivestituresasadmissionsoffailedstrategy

2、—thathavingcertainbusinessesunderthesamecorporateumbrellanevermadesense.Manyworrythatsheddingassetswillcostacompanythebenefitsofscale,cutintotheadvantagesofanalystcoverage,orevendamageemployeemorale.Spin-offsinparticulardrawscrutinybecausetheyshrinkthesizeoftheparentcompanybut,unlikesales,don’tgen

3、eratecashtoreinvest.Wedon’tbelievetheseargumentsholdup.What’smore,theymayleadexecutivestopassupvalue-creatingopportunities.Afundamentalprincipleofcorporatefinanceholdsthatabusinesscreatesthemostvalueforshareholdersandtheeconomyasawholewhenitisownedbythebest—or,atleast,abetter—owner.1Soitmakessense

4、thatcompaniesshouldcontinuallyreallocatetheirresourcesascircumstanceschange.Moreover,thebenefitsofbeingpartofalargecompanycomeatacost;infact,manyspun-offcompaniescanmakesubstantialcutsinoverheadcostsoncetheyareindependent.Investorstypicallydon’tcareaboutacompanybeingtoosmallonceitreachesathreshold

5、ofabout$500millioninmarketcapitalization.2Andinourexperience,executivesandemployeesofspun-offcompaniesoftenfeelliberatedandquitehappytobeontheirown.Soit’sagoodsignthatthere’sbeensomethingofarevivalinspin-offactivitythisyear.AccordingtoBloomberg,asofAugust25,174companieshadannouncedspin-offsofallsi

6、zes—quicklyapproachingthepreviousglobalrecordof230,in2006.Amongthenotabledeals:KraftFoods’sspin-offofitsNorthAmericangroceryunitandConocoPhillips’sspin-offsofitsdownstreambusinesses.Thetricktoexecutingaspin-offstrategy—andtoovercomingpredictableobjectionstoit—istounderstandwherethevalueiscreated.M

7、arketstypicallyrespondfavorablytospin-offs,butsavvymanagersunderstandthatsuchdealscreatevaluenotfromsomemechanicalmarketreactionbutfromthesharpenedstrategicvisionthatcomeswithrestructuringorthetaxadvantagesrelati