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Specialist view
INCREASED CARVE-OUT ACTIVITY IS EXPECTED IN THE NEXT 1-3 YEARS - DISRUPTION DRIVES ACTION
Over two-thirds of participants expect the number of carve-out transactions to increase in the next 12-36 months. In particular the automotive supply (64%),
mechanical engineering (42%) and energy (42%) industries expect to see a rise in carve-out transactions - the drivers being the transformation of business models
and a focus on core business activities (72%)
"Core business areas are
defined by the corporate
strategy and, depending on the
business model, face rapidly
evolving technological
developments, regulatory
requirements, shareholder
activism and other disruptive
drivers. Financing banks are
also increasingly imposing
stricter conditions on nonsustainable
business models."
"The range of sustainability
regulations introduced by the
European Commission's
initiative to curb climate
change, further increase the
existing pressure to take
action."
"If the business units to be
divested are not sustainably
profitable, the window of
opportunity is limited, and the
transaction will take place on
less favourable terms meaning
that necessary
transformation steps in
respect of the business often
have to be carried out by the
buyer and are a key aspect of
the purchase price
calculation."
"Carve-out transactions can be
used strategically to defend
technology leadership, divest
businesses that are less
sustainable from an ESG
perspective, and/or meet
stakeholder requirements
more effectively - with the aim
of securing the company's
long-term competitiveness."
"Structural change and
disruption can force companies
active in certain industries to
consider exiting business areas
to focus on growth in future
technologies. Industries
particularly affected by this are
automotive, chemicals, energy
and mechanical engineering as
downstream industry."
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