term "equity carve-out" refers to the situation where a firm's managers give themselves the right to purchase new stock at a price far below the going market price Since this dilutes the value of the public stockholders, it "carves out" some of their value.

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An equity carve-out refers to a situation where a parent company sells a minority stake in a subsidiary to outside investors through an initial public offering (IPO), not to managers purchasing stock at a discounted price.

Term "Equity Carve-Out" Refers to the Situation Where a Firm's