What is demerging?

Demerger, or spin-off, means that (a part of) the assets of a legal entity are transferred to two or more other legal entities. In this process, a part of the assets of the demerged legal entity comes into the hands of another legal entity.

An example is when a company spins off a division and transfers it to a newly established company, often together with an investor. This process is often applied to focus on core activities or to create value by making separate parts of a company independent.