What is CARVE-OUT?

A CORPORATE FINANCE transaction where a company segregates a portion of its business, places it in a separate corporate entity, and sells it to a third party or floats it through an INITIAL PUBLIC OFFERING. A carve out may occur if the company seeks to permanently exit a business segment that is no longer deemed essential to strategic growth, or if it wishes to raise additional CAPITAL for other corporate operations. Also known as SPINOFF.

More On This Topic



Link to This Definition
Did you find this definition of CARVE-OUT helpful? You can share it by copying the code below and adding it to your blog or web page.
Written and fact checked by The Law Dictionary