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How to Plan a Divestiture from HR's Perspective

How HR Roles Plan for Divestitures

An M&A Science Podcast

Hosted by Kison Patel

"The best advice is, when you hear them talking about a potential facility closure, winding down a business, or a carve-out of a business, you want to start the planning right then."

On this Episode

Kison speaks with Jillian Kaebel-Sisk, HR Global Mergers, Acquisitions, and Divestitures Manager at Caterpillar. Jillian's current responsibilities include corporate strategy and business development. This podcast covers how HR practitioners plan for and executive divestitures.

Kison and Jillian talk about the critical factors to consider when planning for a divesture. They also discuss carve-out and divestiture challenges, as well as TSA agreements, asset vs. stock sales, due diligence, and more.

"It is definitely harder to turn the lens upon yourself, then it is to review another target's data. Because what you don't want to happen is, you don't want the buyer to find an issue that you yourself hadn't already been aware of and at least taken steps to remediate. So there is a lot of inward looking."

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Show Notes

00:00 Introduction and Jillian's background

01:10 HR's larger role during a divestiture

01:55 Specific planning examples

04:50 When to start planning a divestiture

06:45 Asset vs. stock sale

09:00 How local laws affect asset and stock sales

10:00 Ring fencing

12:25 Managing employees from different groups

13:23 Carve-out process

16:18 Challenges of working with unions or represented work forces

17:22 Divestiture communication plan

20:35 Key materials HR must prepare for a divestiture's diligence

24:25 Purchasing agreements

26:37 Transition service agreements

30:12 Transition records

31:30 Tips for M&A practitioners preparing for a divestiture

33:03 Closing remarks

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