Which of the following is not true regarding an equity carve-out?

Question

Quizplus · Accepted Answer

An equity carve-out does not arise when a combinor dilutes its interest through an initial public offering of the subsidiary. This is actually an initial public offering, rather than an equity carve-out. In an equity carve-out, the combinor sells a portion of its interest in the combinee to the public in order to take the subsidiary public, while maintaining a controlling interest. The resulting carve-out gains are typically booked as non-operating income, and the transaction can result in the creation of minority interests.

Which of the Following Is Not True Regarding an Equity