What is Carve-out?


A ‘Carve-out’ is a kind of reorganization of the company, wherein a company creates a sister concern and makes it public, while also retaining control. Around 20% of the shares are made public so that the parent company retains an equity stake in the subsidiary.


This kind of subsidiary creation is advantageous for the parent company as it allows the creation of the subsidiary’s market value based on the parent company’s credibility.


‘Carve-out’ also has another meaning in medical services. It refers to carving out separate provisions for a part of health insurance that was not included in the company’s health insurance plan; for example, dental insurance.

More HR Terms

Defined Benefit Plan

What is a Defined Benefit Plan?   A ‘Defined Benefit Plan’ is a pension plan in which a formula is used to determine the benefits

Counterproductive Work Behaviour (CWB)

What is Counterproductive Work Behaviour (CWB)?   ‘Counterproductive Work Behaviour’ or ‘CWB’ refers to the kind of voluntary behaviour by the employees that are counterproductive

Organizational Justice

What is Organizational Justice?   ‘Organizational Justice’ refers to an employee’s perception of their company and the influence this image has on their own attitudes

Contact Us

Contact Us

We use cookies on our website to provide you with the best experience.
Take a look at our ‘privacy policy’