How corporate restructurings have shaped 2024

Corporate restructurings in Spain in 2024, especially spin-offs and holding companies, are booming strategies that companies are using to optimise operations and compete. Corporate restructurings, which have already grown by 15% in the first quarter of 2024. And we are not just talking about numbers, but about decisions that transform businesses, improve operations and prepare companies for what lies ahead.

Why so many firms are turning to restructuring

The reasons are clear and each company has its own reasons. Some of the factors driving these decisions are:

Accelerated digitisation: Failure to adapt means falling behind.
Regulatory changes: new laws require more efficient and clearer structures.
Competitive pressure: competing globally means optimising every resource.
Search for tax savings: the right structure can make a big difference to your taxes.

What is important is that these restructurings are not just responses to problems. They are also a way of discovering opportunities and improving.

Splits. When dividing means winning

Sometimes a company works best when it is broken up into more manageable parts. This is what we call spin-offs, a growing trend that has increased by 22% this year. But why make this decision?

What are splits?

Full demerger: a company is split up completely, with its parts forming new companies.
Partial spin-off: a part of the business is spun off, but the main company continues to exist.

What are the advantages?

Specialisation: each part of the business focuses on what it does best.
Attracting investors: some areas are more attractive if presented independently.
Conflict resolution: Dividing may be the best way to resolve differences between partners.
Tax optimisation: a clearer structure usually means fewer tax complications.

Splits are not a retreat, but a strategy to move forward with more strength.

Holding companies: are increasingly popular structure

Another big trend this year is holding companies, which have grown by 18%. This type of structure allows a company to control several subsidiaries, centralising management and reducing risks.

Why do companies choose a holding company?

Centralisation: facilitates decision-making for business groups.
Equity protection: if something goes wrong in one subsidiary, it does not affect the rest of the group.
International growth: this structure is ideal for companies that want to expand outside Spain.
Tax optimisation: tax consolidation can save a lot of headaches (and money).

New trends in corporate restructuring

1. Commitment to sustainability

Companies are restructuring with a more sustainable approach. By 2024, 65% of restructurings in Spain will include sustainability-related objectives. This is not just a trend, but a necessity.

2. Digitisation does not stop

78% of companies are investing in automation and digital transformation as part of their structural changes. Going digital is not an option, it is a must.

3. Hybrid work as a standard

More and more companies are incorporating flexible working models in their restructurings. Seventy per cent of companies that have restructured this year have implemented telework or hybrid working policies.

4. Focus on what matters

Many companies are selling assets they no longer consider essential in order to concentrate on what really generates value for them. By 2024, 55% of restructurings have included the sale of non-strategic business units.

Restructuring is not a decision to be taken lightly. They involve legal, tax and labour changes that, if not handled well, can be costly. This is where the support of an expert team comes in.

At Confianz, we accompany our clients and design tailor-made solutions, adapted to the needs of each client.

By Manuel Urrutia