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Spin-off

Spin-off Definition

A spin-off occurs when a company decides to separate from one of its divisions or subsidiaries. The parent company will not just sell the subsidiary to a different firm, but rather it will create a brand new stand-alone company and distribute the stock in the new company to its existing shareholders.


Additional meaning of Spin-off:

The separation of a subsidiary or division of a corporation from its parent by making it a new corporate entity and by issuing shares in the new entity. Shareholders in the parent receive shares in the new entity in proportion to their original holding and the total value remains approximately the same.


RELATED TERMS
Acquisition
Merger







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