Independent IT from day one – even after a carve-out
Related topics
An IT carve-out is the premier league of corporate integration – because every decision affects business operations.
During a carve-out, the existing IT typically remains with the seller – the spun-off business unit has to rebuild its entire IT infrastructure, often under time pressure and during a limited Transitional Services Agreement (TSA) with the former parent company. We handle the unbundling, the establishment of the independent IT landscape and the management of the transition phase – so that the new business unit is operational from day one, not just after the TSA expires.
Why an IT carve-out is different from an integration
A merger brings together two existing IT landscapes. A carve-out is the opposite challenge: the spun-off part of the company often no dedicated IT organisation, no in-house contracts and no dedicated infrastructure – everything has to be recreated while ongoing business operations must not be interrupted.
Typical starting position:
- No independent IT or SAP organisation in place
- Shared systems and contracts must be unbundled
- Where applicable, the vendor may provide IT services for a limited period only via a TSA (Transitional Services Agreement).
- Close procedural integration with the previous parent or sister company must be unwound
If this phase is not managed properly, there is a risk of operational disruptions if the TSA expires before the company's own IT structure is in place.
Our approach to IT carve-outs
A successful IT carve-out begins long before the closing – and only ends once a stable, independent IT function is in place.
The 4-phase processes
1. Analysis & Unbundling
We record the existing IT landscape of the business unit to be spun off, identify shared systems, licences and contracts, and determine what needs to be unbundled – including an assessment of which TSA services are actually required and for what period.
2. Target architecture & structure
We are defining the target architecture for the new, independent IT organisation – from directory services and email through to a ERP system right through to the network infrastructure – and set them up in parallel with the ongoing TSA, so that there is no gap between the phasing out of the transitional services and the start of our own operations.
3. TSA Management
We coordinate the transition phase with the previous parent company or sister company, monitor the deadlines and scope of the TSA, and ensure that our own infrastructure is up and running in good time before the TSA expires.
4. Stabilisation & Handover
Following the migration to the standalone IT environment, we support stable operations and hand over responsibility for ongoing support – either as a standalone in-house IT organisation or as part of our Managed Services.
Frequently Asked Questions about the IT Carve-out
An IT carve-out is the process whereby a spun-off or separated part of a company establishes its own independent IT infrastructure, as the existing IT infrastructure remains with the seller or the parent company.
During a post-merger integration, two existing IT landscapes are merged. In a carve-out, a completely new, independent IT landscape is created because the spun-off part did not previously have its own infrastructure.
A TSA is a temporary contract through which the seller continues to provide IT services to the carved-out business division for a transitional period until its own infrastructure is up and running. TSA management – deadlines, scope of services, handover timing – is one of the most critical factors for a smooth carve-out.
This depends on the size and complexity of the IT landscape; in practice, TSA transition phases often range from a few months to a year, and in some cases even longer. It is crucial to link the timetable realistically to the actual time taken to set up the new infrastructure, rather than to a fixed TSA deadline.
If the transitional agreement expires before the standalone infrastructure is operational, there is a risk of business disruption – ranging from restricted system access to the halt of mission-critical processes. Early, realistic scheduling is therefore essential.
The earlier, the better – ideally already during the due diligence phase, so that the IT requirements and the TSA scope are realistically integrated into the transaction planning from the outset, rather than only becoming apparent after signing.
The closing is the starting point – not the finish line.
Arrange an initial consultation on the IT carve-out
An IT carve-out presents companies with particular challenges – from unravelling complex, organically grown IT landscapes to ensuring business operations run smoothly.
In a no-obligation 30-minute initial consultation, we will jointly analyse your current situation and show you where we can create the greatest added value for your project.
Together we will find out whether and how we can effectively support you in planning and implementing your IT carve-out.
I look forward to exchanging with you.
30-minute IT carve-out consultation – with no obligation and free of charge.