Demergers - the dividing up of an organisation into two or more parts, is once again becoming common.
I remember years ago when first creating my slides and notes for Higher Business Management at Mearns Castle High that finding examples of demergers were pretty rare. Rarer still were examples pupils had heard of! The only one I recalled was Racal Instruments splitting up and Vodafone being one of the new companies.
However there is an increase in the trend of the demeger.
Cable & Wireless, the famous UK communications firm will demerge into Cable & Wireless Worldwide plc and Cable & Wireless Communications plc, the new name for Cable & Wireless International.
Carphone Warehouse will split into New Carphone Warehouse (focusing on the retail) and TalkTalk (service provider).
Motorola are the latest big name to announce plans for a demerger.
Study Question:
What are the benefits to an organisation of demerging?
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