The initial public offering for an individual unit of a corporation. Because the corporation may itself be publicly traded, this may be a form of spinning off. However, the parent company rarely offers a controlling interest in the unit so as to maintain it as a subsidiary. A corporation may make a splitoff IPO for a number of reasons, including expansion of operations of the subsidiary or the need to repay its debt.
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See equity carve-out.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.