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Chapter 14

Business reorganisation (‘unbundling’)

3.1 Introduction to business reorganisation (‘unbundling’)

Unbundling is the process of selling off incidental non-core businesses to release
funds, reduce gearing and allow management to concentrate on their chosen core
businesses.

Reasons for unbundling

 The sum of the parts of the entity may be worth more than the
whole.

 Divesting unwanted or less profitable parts.

 To shift the strategic focus onto the core activities.

 A response to crisis.

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