Buyers and sellers should agree on a clearly defined strategy for the operation of the post-closing business, immediately after closing than in the long term. Be prepared to identify the specific services that are provided, the length of time for which these services are offered, the appropriate service standards and the costs and expenses incurred. Early treatment of these issues will allow for cleaner development and fewer rounds of negotiations once the TSA has been reduced to the letter. In each transaction of the M-A, which has a transition services component, it is the responsibility of the buyer and the seller to reach an agreement on certain important considerations before the completion of the transaction. These considerations should be negotiated as soon as possible by the parties to the TSA, ideally during the due diligence phase. The main issues to consider in negotiating and developing an ASD are presented below. Indira Gillingham, senior manager, and Mike Stimpson, senior manager at Deloitte Consulting LLP, provide practical advice on using ASD to achieve a quick and clear separation. An ASD can expedite the negotiation process and financial conclusion by allowing the agreement to be reached without waiting for the buyer to assume responsibility for all critical support services. Disposals are generally difficult to obtain, especially when the people, processes and systems involved are deeply integrated into the seller`s business or when services and infrastructure are spread across multiple industries.
Identifying and placing parts in a sale can be a complex and time-consuming process; However, experience and careful planning provide an effective result for both parties. During the planning process, participants in the relevant business units on both sides should consider the transition period between the transaction deadline (day 1) and the complete separation of businesses (day 2) to determine the strategy for each business process, associated applications and the underlying infrastructure. As our examples show, good negotiators and leaders can change the course of a carve-out.