Carve-out (Equity Carve-Out)

Carve-out (Equity Carve-Out): "Carve-out (Equity Carve-Out) What does it Mean? 1. Sometimes known as a partial spinoff, a carve out occurs when a parent company sells a minority (usually 20% or less) stake in a subsidiary for an IPO or rights offering. 2. Where an established brick-and-mortar company hooks up with venture investors and a new management team to launch an Internet spinoff. Investopedia Says... In most cases the parent company will spinoff the remaining interests to existing shareholders at a later date when the stock price is much higher. Also known as a 'carveout' or an 'equity carve out.'"