Corporate Orphan
Categories: Banking, Company Management
A corporate orphan is usually the result of a company buying another company...
...and it totally backfiring.
Obviously, when one company acquires another, the hope is that this new company will help them achieve some goal, but that doesn’t always happen. Cue the corporate orphan.
It can also happen when a company’s goals evolve, making one of their divisions worthless.
This doesn’t necessarily mean these companies or divisions are losers though. Sometimes a Daddy Warbucks scenario comes into play: another company who actually will benefit from the acquisition buys them, leaving the seller with a huge profit.