Drilling Down on Breaking Up

Over the past year, stray assets have been lining up along Wall Street for interested investors to peruse. While these orphans can be bargains, investors should be clear about what they're getting into before deciding whether to take such deals home.

This week, the Wall Street rummage sale beefed up, with three large U.S. conglomerates -- Texas Instruments(TXN Quote), Duke Energy(DUK Quote) and Tyco(TYC Quote) -- either announcing or studying some manner of asset sale or breakup.

Shareholders generally like divestitures: A public company signals to the market it will fine-tune its focus by selling an asset, and the market can expect better returns from core segments. But there are so many different types of asset sales -- outright segment divestitures to strategic buyers or private equity firms, spinoffs, split-offs, carve-outs, partial IPOs and reverse mergers in the public market -- that deciding whether a particular transaction will indeed create value requires a probing eye.

Under the Hood

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