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Published February 24, 2008 at 10:00 AM
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Alvarez & Marsal Business Consulting's Anthony Treccapelli and Ronald Bisaccia weigh in on the difficulties of managing technology in a carve-out in a Feb. 25 Deal newsweekly column.
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They note: Unlike mergers, carve-outs
involve the acquisition of a business unit from a parent company to
create an independent business. The new company, which formerly relied
on shared corporate support services, is forced to build new technology
capabilities, making the transaction riskier than traditional
integrations, which focus on identifying synergies and cutting costs.
...The first step is to assess the
gap between the technology assets being acquired and the standalone
business' day-one operational needs. Not only will this minimize risk,
it can be important in negotiating the deal price. For example,
replacing or upgrading technology assets will impact capital costs and
should be properly budgeted for.
Read on for the other critical factors
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