The board of directors of a large conglomerate has decided that the investment opportunities for the firm are limited and that greater value could be created for the shareholders if the firm were divided into four independent businesses. Following approval by shareholders, the firm executed this strategy which is best described as a
A) Split-up
B) Split-off
C) Spin-off
D) Equity carveout
E) Reverse merger

Question

Quizplus · Accepted Answer

A split-up involves dividing a parent company into two or more independent companies, effectively dissolving the original entity. This matches the scenario where a conglomerate is divided into four independent businesses.

The Board of Directors of a Large Conglomerate Has Decided