Carve Out – IT contract consideration
Separation of IT contract and software license portfolio in the course of a carve out
Abstract
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
Procedure
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