Spin-Off: Divide to preserve value

Sometimes, partners who built a company together lose strategic alignment or simply wish to pursue different paths. Forcing a corporate coexistence when there are no longer common interests often leads to conflict, loss of focus, and destruction of value.

A spin-off – a figure recognized in Panama under Law 85 of 2012 – allows the existing company to be divided at the patrimonial level, transferring assets, liabilities, contracts, and operations to new entities, so that each partner can continue their business project independently and harmoniously.

Key advantages of a well-structured spin-off:

• Avoids litigation between partners: separates without “fighting,” under clear rules.
• Preserves value: each vehicle continues operating without interrupting activity.
• Clarity of control and governance: each partner manages “their” company without friction.
• Reputational and operational hygiene: the business is not dragged into public disputes.
• Legal and tax efficiency (when properly planned under current regulations).

A spin-off is not a failure; on the contrary, when properly used it is a strategic tool to protect business continuity, partner relations, and the value created.

Are you evaluating restructuring between partners? Talking early is almost always cheaper – legally and emotionally – than litigating later.