There isn’t much consistency when it comes to trendy ideas among corporate consultants and analysts. But these days, companies concentrating on their core businesses are considered to be the formula for success on the market and on the stock exchange.
This means that spin-offs are in vogue, as corporations are jettisoning divisions seen as extra weight. But what how successful are these spin-offs, and what do shareholders gain from them?
Take E.ON, for example. In early September, the German energy giant spun-off its conventional fossil-fuel power business and floated it on the stock market under the name Uniper. Existing stockholders were given one Uniper share for every 10 shares of E.ON stock they held.