CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 78.1% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

What is divestiture?


This is when a company sells or gets rid of its assets, for example as part of a merger or acquisition. An organisation may also divest areas of its business that are not part of its core operation so it can focus on what it does best.

Where have you heard about divestiture?

You might have heard examples of companies selling part of their operations to streamline their business or reduce debt. In 2012, photography company Kodak announced it would divest its film, scanner and kiosk operations as part of its efforts to emerge from bankruptcy.

What you need to know about divestiture.

Divestiture may be carried out as a sell-off , spin-off  or equity carve-out. One popular reason for divestiture is under performing business units. Selling these can cut operating losses and make organisations more efficient. Divestiture provides extra funds, enabling companies to pay off debt and use the cash to focus on other operations. Divestiture may also be forced. For example, following its merger with EE, news emerged that BT may be forced by Ofcom to divest its Openreach network. It eventually spun off Openreach into a legally separate company in 2017.

Find out more about divestiture.

Check out our guide to disinvestment  to learn more about how companies sell off or liquidate their assets.

Latest video

Latest Articles

View all articles

Still looking for a broker you can trust?

Join the 610,000+ traders worldwide that chose to trade with

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading