The number of spin-off companies has doubled over the past decade, according to brand management and consulting firm Lippincott & Margulies, and it wanted to know how the
successful spin-offs manage their communications. The company studied divestiture activities of U.S.-based companies over a five-year period, looking at communications factors
present in successful and unsuccessful spin-offs. The study found that 83 percent of the winning spin-offs (defined as those that created shareholder value) clearly positioned
themselves as independent from the parent company. Other findings:
- 90 percent of successful spin-offs communicated good terms relationships with the parent company
- 88 percent clearly described their businesses and markets
- 78 percent communicated increasing shareholder value as a driver of the spin
Of companies that were unsuccessful, 61 percent did not rename, and 71 percent communicated the parent company's best interests as the driver of the spin-off. (Lippincott,
Margulies: Howard Bailen, 212/521-0089)