Corporations often start a business that becomes a famous brand, or buy companies that already have highly recognized brand names.  Over time these brands often lose their earnings power.
Corporations who find themselves in this situation have few options other than to sell these operations or to spin them off.

Spin-offs are a standard method employed by companies who need to dump divisions that are performing poorly.  Ownership of these spin offs is passed on to the unfortunate shareholders of the parent company, leaving the shareholders with the gift of ownership of a business that often has little value.

Under some circumstances corporate boards make a decision to sell branded businesses which have retained much of their value but are no longer a good fit for the evolved core business.
 
Some of the most iconic companies in the world have been cast off by their parent firms. The most recent highly-visible example is GE’s (GE) plans to wash its hands of its industrial and appliance divisions which include the toaster oven and washer-dryer products which have made GE a household name since the 1950s.

24/7 Wall St has compiled as list of famous companies that were sold by their parents or now exist as stand- alone operations.

GE’s (GE) appliance division has been part of the company since 1907 and is now on its way out, part of the conglomerate’s fantastic plan to keep only its best businesses under its umbrella.  "Appliances" should net GE $5 billion. GE brought US consumers their first air conditioners, electric can openers and electric ranges in this famous division.  Eighty years of branding will be sold off to the highest bidder, and the buyer may not even be an American company.

What would the laundry detergent market be without "All" and "Wisk"? These brands have been part of the Unilever family, until now that is. Unilver will hold on to some of its other sterling names including Lipton and Ben & Jerry’s, but private equity firm Vestar Capital Partners will put up $1.45 billion to take the Unilever North American laundry detergent business and combine it with  a company which also owns the "White Rains" brand.

Exxon Mobil (XOM) may be the second largest company in the Fortune 500, but how many people would know much about the company if it were not for its 12,000 gas stations with the "Winged Horse" logo and "Tiger in the Tank" slogan. While many of the outlets are already owned by individual distributors, Exxon is disposing of every station it owns. The company says the margins are too poor with gas prices near $4. It intends to focus on exploration and oil refining.

"Dr. Pepper" traces its roots as one of America’s most famous soft drinks back to 1885. The brand still has its own museum in downtown Waco, Texas, a city perhaps better known now for cults instead of beverages. Cadbury Schweppes spun-off the operation, which includes 7Up and Snapple, to shareholders and it now trades as Dr. Pepper Snapple Group (DPS). Cadberry was astute. The stock in the new company is off 15% over the last three months.

Kinkos has been a part of the US small-business landscape since 1970, when it was founded by Paul Orfalea and nicknamed for his curly hair. After being sold to private equity firm Clayton, Dubilier & Rice, the office printing-supply company was pawned off again to FedEx (FDX) in 2004 for $2.4 billion. FedEx kept the name until earlier this year when it decided it would build its own branding by calling the operation and retail outlets FedEx Office.

Almost no one knows that Motorola (MOT) is in the home set-top and bar-code scanning businesses. The electronics company invented the car radiotelephone in 1946 and began its TV business in 1947. In 1983, Motorola created the world’s first commercial handheld cellular phone. It exited the TV business years ago, leaving it as a cellular phone business, at least in the public’s mind. Motorola has been crushed in the handset division, unable to duplicate the success of its Razr model which helped the company to a 22% global market share three years ago. It has lost half of that share and in the second quarter of this year Motorola’s cell-phone operation suffered a 22% revenue drop to $3.3 billion and lost $346 million. Motorola plans to spin-off the handset division, but, as fast as this business is losing money, it may have next to no market value.

Vehicle leasing has been the preferred way for millions of consumers to get themselves a brand new car without taking on the obligations of a loan. For years, Ford (F), GM (GM), and Chrysler have offered leasing options through their financial arms. That business has become a big money-loser as SUVs and pick-ups come back to the dealers after the lease term with very little resale value because of high gas prices.  Selling these fuel-inefficient vehicles as used cars has become such a massive money loser that Chrysler has left this business altogether. If the other two members of the Big Three drop out, there will be no such thing as leasing an American car from the company that made it.

Wm Wrigley Jr. Co is about to become history. Founded in 1891, the company is still run by a member of the founding family, William Wrigley, Jr. But, greed got the best of the Wrigley board and the most famous name in gum is being sold to Mars, the most famous name in chocolate bars. Warren Buffett, himself one of America’s most famous icons, will help fund the deal.

Douglas A. McIntyre

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