Mergers and acquisitions are given a lot of importance for growth of business organizations. It plays a vital role in the corporate strategy and maintenance of the business portfolio. However, when a company diversifies into various businesses and its corporate portfolio becomes huge, it becomes difficult to maximize returns on capital. Also, it gets difficult to take advantage of new opportunities for growth.
Company divestiture plays a vital role in restructuring of the organization’s corporate portfolio and maximizing growth. Compared to M&A, companies don’t give much importance to divestitures. They fail to realize that if this activity is carried out perfectly, it can provide huge benefits in terms of future growth, shareholder value and cash flow.
Why divestiture is done?
There are various reasons why a business owner might want to divest a business. From restructuring the business portfolio to short-term cash generation, irrespective of the reason, the main aim of divestiture is to get the best return.
Organizations should do divestiture in an accelerated time frame in order to get optimum return from it. It is important to ensure that the to-be-divested units are configured in such a manner that it gives out maximum appeal to potential buyers.
In order to develop divestiture strategy, companies need to assess their corporate portfolio comprehensively. They need to identify opportunities for value creation. From aligning assets with the best opportunities for businesses to development of a sequencing strategy for divestiture transaction, this process entails various steps.
There are several companies that offers services related to mergers and acquisitions in India. It is recommended to do some research and find a reliable option. You can either ask for references or shortlist two three companies on your own. Compare their charges and portfolio to make a final choice.
Company divestiture plays a vital role in restructuring of the organization’s corporate portfolio and maximizing growth. Compared to M&A, companies don’t give much importance to divestitures. They fail to realize that if this activity is carried out perfectly, it can provide huge benefits in terms of future growth, shareholder value and cash flow.
Why divestiture is done?
There are various reasons why a business owner might want to divest a business. From restructuring the business portfolio to short-term cash generation, irrespective of the reason, the main aim of divestiture is to get the best return.
Organizations should do divestiture in an accelerated time frame in order to get optimum return from it. It is important to ensure that the to-be-divested units are configured in such a manner that it gives out maximum appeal to potential buyers.
In order to develop divestiture strategy, companies need to assess their corporate portfolio comprehensively. They need to identify opportunities for value creation. From aligning assets with the best opportunities for businesses to development of a sequencing strategy for divestiture transaction, this process entails various steps.
There are several companies that offers services related to mergers and acquisitions in India. It is recommended to do some research and find a reliable option. You can either ask for references or shortlist two three companies on your own. Compare their charges and portfolio to make a final choice.
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