Strategic Management Review > Vol 2 > Issue 2

Divestitures, Value Creation, and Corporate Scope

Elena Vidal, Zicklin School of Business, Baruch College, The City University of New York, USA,
Suggested Citation
Elena Vidal (2021), "Divestitures, Value Creation, and Corporate Scope", Strategic Management Review: Vol. 2: No. 2, pp 413-436.

Publication Date: 14 Sep 2021
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In this article:
Divestitures and Reduction in Corporate Scope 
Divestitures and Corporate Scope Renewal 
Future Research Directions 
Discussion and Conclusion 


This paper exposes the relatively limited understanding we have of divestitures as a tool for corporate renewal. I argue that divestitures can be used by managers to generate slack in nonscale free resources, particularly managerial capacity, which are needed to support corporate renewal. I provide a review of the literature, using it to highlight the need for future research. In particular, this is a call for us to gain a better understanding of the drivers and consequences of divestitures and the different ways in which they can be implemented; moreover, this is a call to consider how divestitures are used either in combination or sequentially with other governance modes that affect corporate scope and can lead to corporate renewal, namely build, borrow, buy decisions.



Strategic Management Review, Volume 2, Issue 2 Special issue on Corporate Renewal
See the other articles that are part of this special issue.