Invest wisely, divest strategically: tapping the power of diversity to raise valuations
- Does corporate diversification destroy shareholder value? Iestment analysts believe so, often applying a “conglomerate discount” to diversified companies by valuing them at less than the sum of their parts. Academic research has confirmed that diversified companies’ valuations suffer from a conglomerate discount by comparing their actual market value with the value implied by the matched portfolios of pure-play companies.
| Document Type: | Report |
|---|---|
| Language: | English |
| Author: | Bernhard SchwetzlerORCiD, Christin Rudolph |
| Chairs and Professorships: | Chair of Financial Management |
| URL: | https://www.bcgperspectives.com/content/articles/divestitures_iest_wisely_divest_strategically_tapping_power_diversity_raise_valuations/ |
| Year of Completion: | 2014 |
| Note: | Munich/Leipzig: The Boston Consulting Group / HHL Leipzig Graduate School of Management, 2014 |