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Question

What is a Demerger?

Answer

A company 'de-merges' when it splits into two or more companies, these will not necessarily be new companies.  The value of each of the new companies usually reflects the value of the old company.  Again similar to a merger the two new companies may well be worth more than the old company, however if the market thinks the de-merger will not benefit shareholders the new companies could be worth less.

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