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Steve Williams Highlights Key Considerations for Spin-offs in Corporate Counsel
February 12, 2024
Corporate partner Steve Williams discussed the most important considerations for companies considering a spin-off transaction in an article published in Corporate Counsel on February 12. In the article, “What Every General Counsel Should Know Before Doing a Spin-Off,” Steve addresses the challenges and issues specific to spin-offs, including the differences between a conventional sale and a spin-off, how to preserve the tax-free nature of the transaction and restrictions on M&A activity before and after the spin-off.
While the timeline of a spin-off can be long, he observes, the window for decision-making can be short. “That timing demands an early focus on the hard decisions of allocating assets and liabilities and a quick pivot to implementing those decisions,” Steve says.
Executing a spin-off, Steve notes, requires proper expectation-setting for CEOs and teams. “Even experienced deal professionals can be surprised and resistant when they run into the unique elements of documenting a spin-off,” Steve says. A strong spin-off deal team, he says, “will take coordination demands off of your shoulders, allow for ongoing monitoring of progress and upcoming steps, and communicate effectively to ensure the spin-off is executed seamlessly.”