Year: 2025
Type: review
Abstract: This analysis explores the complex relationship between spin-offs and firm value and provides an in-depth analysis of how spin-offs affect firms. Through the integration of empirical results, theoretical models and real cases, we reveal the various ways in which spin-offs alter firm performance and influence market valuation. The main aspects we explore are the impact of spin-offs on firm concentration, operating efficiency, capital structure and the reduction of asymmetric information between firms and investors. Our analysis balances the discussion of potential benefits - such as increased value creation and operational transparency - with risks, such as short-term market volatility and management challenges. What distinguishes this analysis is its balanced critique of the existing literature. We not only summarise current knowledge, but also identify important gaps and suggest areas for future research that will be valuable for academics and practitioners in the fields of finance and corporate strategy. For business leaders, this report provides useful information and a well-developed framework for assessing the potential impact of a spin-off decision. Policy makers will also find the research on the broader economic implications particularly useful. In summary, this report provides a comprehensive and critical analysis of spin-offs, combining theoretical conclusions with practical implications. It deepens the understanding of how these restructuring strategies affect firm value and provides a comprehensive guide to help navigate the complexities of corporate restructuring in today's business environment.
Authors: Yunsong Deng, Chengcheng Song, Yulai Jiang, Rong Zhao
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4414088055