Spin-offs can deliver strong results when executed well, even though the average spin-off underperforms the S&P 500 in the three years following separation. Research shows that top-quartile spin-offs significantly outperform both the market and average spin-offs, creating substantial value for shareholders. These standout transactions benefit both the spun-off entity and the parent company, with combined total shareholder returns far exceeding benchmarks. Successful spin-offs typically reduce administrative and production costs and improve financial performance, with more than 90 percent increasing revenue growth, EBITDA margins, or both within three years.

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