Asset Sale
A transaction in which a company sells specific assets or divisions rather than the entire entity.
What is Asset Sale?
An asset sale is a corporate transaction in which a company sells specific assets, subsidiaries, or business divisions to a buyer, rather than selling the entire company through a stock purchase. Unlike a stock sale, an asset sale allows the buyer to select which assets and liabilities to acquire, leaving unwanted obligations with the seller. Asset sales are commonly used to raise capital, reduce debt, exit non-core businesses, or comply with antitrust requirements imposed as merger conditions. The seller retains the corporate entity and any proceeds, which may be returned to shareholders, used to retire debt, or redeployed into core operations.
Example
In November 2021, General Electric completed the sale of its Aircraft Leasing subsidiary, GE Capital Aviation Services (GECAS), to AerCap Holdings N.V. in a transaction valued at approximately $30 billion. GE received $24 billion in cash plus a 46% equity stake in the combined AerCap entity, enabling GE to reduce its industrial leverage and focus on its core aviation, power, and renewable energy businesses.