All of the stock of P Corporation is owned by two individuals, J and K.P owns all of the stock of Q that it acquired by purchase 10 years ago.P manufactures disk drives while Q manufactures floppy disks.Both corporations have substantial E&P.J and K are deadlocked on the direction of their businesses.As a result, they have agreed to go their separate ways with J taking over the business of Q.The most logical way to accomplish their objective is a

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A split-off is the separation of a subsidiary into two separate entities, where one entity is owned by the parent company and the other is owned by the shareholders of the parent company. In this case, J can take over the business of Q by having P split-off the subsidiary Q and distribute the Q stock to J. This allows for a clean break between the two parties and allows J to take control of Q while P retains control of its own business.

All of the Stock of P Corporation Is Owned by Two