Page 316 - AFM Integrated Workbook STUDENT S18-J19
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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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