Carve Out – IT contract consideration

Carve Out – IT contract consideration

Separation of IT contract and software license portfolio in the course of a carve out


In preparation for a carve out, the IT contracts and the software license inventories were divided according to need and corresponding agreements were made with vendors.


Initial situation and problem definition

Carve out of a previously fully integrated group subsidiary as an independent company

Requirement to provide the new company with IT contracts and software licenses according to its current needs

Requirement to consider all IT contracts for hardware, software, services and telecommunications held by other group companies, currently shared by the company subject to the carve out


Objectives, project scope and benefits

Continued access to centrally held IT services

Replacement of internal agreements with headquarter by independent agreements with vendors

Needs assessment completed, definition and management of transitional service agreements

Determination of commercial effects of the carve out



Identification of relevant contracts and associated contract managers, request access to contract documents

Establish contract transition options by means of contract analysis, selection of transition scenario for each contract

Negotiation and coordination of contractual and any additional agreements with vendors

Transfer of contracts and license inventory

License compliance check after separation


Results achieved and outlook

Coordinated approach agreed with purchasing, legal and contract managers at headquarter and affiliated company

Specialist functions supported by central pre-audit

Status tracking of all contracts simplified by means of uniformly defined milestones

Coordination efforts reduced through defined transition scenarios and use of standard letters