Companies Are Breaking Up, and You Get to Pick the Winners

From General Electric to Glaxo and SSE, big companies are splitting up. Do investors benefit when given the choice to "pick the winners"?

James Gard 19 November, 2021 | 1:12PM
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GE officesLike empires, companies rise and fall over time. In 2021, the idea that “bigger is better” is starting to be questioned and that has implications for public markets and investors.

It’s true that stock market indices, which weight companies by size, still favour gigantic companies. On that, look no further than the excitement over Tesla breaching the $1 trillion mark. Apple is on the inevitable march to the $3 trillion milestone, and has this year become more valuable than the French economy. And because of share options, the wealth of the super-rich like Elon Musk and Jeff Bezos has rocketed, the result of speedy company growth.

But the message among consultants, fund managers, activist investors and even boardrooms is that being “nimble” as a company is now a competitive advantage. That means break-ups are back on the agenda, with companies being dismantled, de-merged and split up across the board. Let’s look at some recent examples and what it means for investors. Are they likely, as advocates of corporate divorces believe, to “unlock value” for shareholders?

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James Gard  is content editor for