M&A Carve-Out: Separating an Industrial Services Division for Sale

A FTSE 250 industrial group had announced the planned divestment of its industrial services division, with an enterprise value in the order of £350 million and a target completion window of nine months. The division shared materially with the parent across IT systems, finance, HR, procurement, real estate and shared services, with no clear separation boundary defined at signing. The group's prior carve-out had over-run by six months and triggered material transitional services arrangements that had become difficult to exit. The board wanted a faster, cleaner separation that protected sale value, met the buyer's day-one operating requirements and avoided open-ended TSAs. The divisional management team needed to remain focused on trading performance throughout the carve-out, and the wider group could not afford disruption to its retained business as a side-effect of the separation.

Intology was appointed Carve-Out Director, reporting jointly to the group CFO and the divisional CEO, with a clear mandate to deliver a clean separation by exchange-plus-nine-months. We established a single Carve-Out Management Office covering the full estate of separation workstreams: IT, finance, people, real estate, contracts, procurement and shared services. A separation principles framework was agreed within 30 days, providing the boundary calls that had been left open at signing. Day-One readiness was defined explicitly and tested through three structured rehearsals across the carve-out window. Critical IT services were either cloned, separated or replaced based on a deliberate cost-versus-risk evaluation rather than a default-clone approach. TSAs were minimised by design, with each remaining TSA priced, time-boxed and given a defined exit plan from the outset. Communications were carefully sequenced to protect employee, customer and supplier confidence across the announcement, signing and completion phases.