IT carve-out services: a controlled Day 1 and a TSA you can exit
Separate the business on an agreed date, with the work beyond completion planned from the outset.
Heremba owns the technology separation workstream. We establish what the business needs to operate, which services remain with the seller and how those dependencies will end. We commit to a delivery date against an agreed scope and dependency plan, with changes made explicit as the programme develops.
Separation delivery, evidenced
$30M programme, 9 months, delivered $500K under budget.
Make the standalone cost visible
The business perimeter and the technology perimeter are different questions. A transferred operation may still depend on the seller’s identity services, applications, infrastructure, support or data. Each dependency needs a decision about how the business will operate at completion and how it will operate afterwards.
The cost of carve-out IT separation extends beyond copying systems. A standalone business may need replacement services, supplier arrangements and support processes. Data may need extracting from shared environments. Migration work may depend on decisions or access controlled by the seller.
Without a clear destination and sequence, a TSA can become the operating model by default. The separation plan needs to show which services will end, what replaces them and the evidence required to confirm the business can operate without them. That work should be visible before the exit date arrives.
Establish the separation route
Define the operational perimeter
We connect the transaction perimeter to the systems, users, data and services required by the business. We identify what is standalone, what is shared and what remains uncertain. The objective is an agreed technology scope that the delivery programme can act on.
Our IT separation consulting work starts with that operational view. It gives the deal team and counsel technical evidence for discussing the arrangements around retained services. Counsel advises on the contractual terms; Heremba establishes what those services need to do in practice.
Set the Day-1 requirements
Day 1 needs a defined operating position. We establish which technology capabilities must be ready at completion and which will continue under transition arrangements. The plan connects those requirements to delivery tasks, tests and decisions.
A separation can reach Day 1 while further work continues. The distinction must be explicit. Completing the transaction does not demonstrate that the standalone estate is complete or that every seller dependency can end immediately. The programme needs both a continuity position and a route to the end state.
Plan the TSA exit service by service
TSA exit support connects each dependency to its replacement or removal. We identify the work required, the sequence, and the input needed from suppliers and both parties. The plan should expose any service whose exit depends on an unresolved decision or another migration.
Exit readiness needs evidence. A replacement service being installed is different from the business being able to use and support it. The programme must connect technical completion with operational acceptance and the agreed process for ending the seller service.
Deliverables for a governable separation
The engagement scopes the following outputs to the transaction:
- Separation scope and dependency registerthe technology perimeter, seller services and unresolved boundaries.
- Standalone requirements and optionswhat must be established, retained or replaced for the intended end state.
- Day-1 technology plancontinuity requirements, delivery tasks and readiness evidence.
- Technical input to TSA schedulesoperational scope and dependencies for counsel and the parties to consider.
- Separation roadmap and cost assumptionsworkstreams, sequencing, one-time costs and ongoing requirements.
- TSA exit planservice dependencies, replacement work, milestones and acceptance requirements.
- Decision and issue recordchanges, outstanding actions and the consequences for cost or timing.
The integration, separation and TSA templates provide a structure for this work. The programme remains specific to the business being separated. A template cannot resolve an unclear perimeter or make a supplier dependency disappear.
Keep the cost and date connected
A date commitment needs an agreed basis. We establish the scope and dependencies supporting the plan, then make changes visible when that basis moves. If a seller service, procurement decision or migration sequence changes, the programme needs to show the effect rather than absorb it into an unchanged status report.
The cost position follows the same discipline. One-time separation work, ongoing standalone cost and transition charges need to remain distinguishable. That allows the client to assess the implications of an option and understand what an extension or scope change would mean for the programme.
Where the work sits in the deal
Within Our M&A Technology Framework, separation is central between signing and Day 1. Diligence findings can provide the starting position; the separation programme carries the work through transition and TSA exit.
Where completion is approaching and the programme needs intervention, Day-1 Readiness & Rescue can address the immediate control problem. Where the separated business will join an existing estate, the end state also needs to connect to post-merger IT integration.
How the engagement works
We scope the work around the transaction perimeter, completion date, seller dependencies and proposed destination estate. The first discussion should include the current separation plan and TSA position where available. Reporting and delivery dates follow the work required and the access available.
Heremba owns the agreed technology workstream alongside the client’s internal IT, the seller, suppliers and other advisers. The plan identifies responsibilities and decisions across those parties. We do not assume that resources or access controlled by another party are available without agreement.
Questions deal teams ask
Does the business need to be fully separated on Day 1?
Not always. The Day-1 plan establishes the technology required for continuity at completion, including any agreed seller services. Further separation work may continue under the TSA. The programme must distinguish that initial operating position from the standalone end state and the requirements for exiting each service.
How do you make a TSA exit date credible?
An exit date needs a defined replacement for the seller service, a delivery sequence and acceptance evidence. We connect those requirements to dependencies and decisions across the parties. A date becomes less reliable when underlying assumptions change without a corresponding assessment of the impact on the plan.
Does Heremba draft or negotiate the TSA?
Heremba provides technical evidence about the services needed, operational dependencies and exit requirements. The parties’ lawyers advise on the contract and its protections. Our work helps make the technology scope operationally specific, so the programme can plan against the arrangements the parties agree with their counsel.
Can you work with the buyer’s chosen technology suppliers?
Yes. The separation plan needs to identify the work required from the buyer, seller and relevant suppliers. Heremba owns the agreed technology workstream and makes those dependencies explicit. Supplier delivery dates, access requirements and acceptance criteria need to align with the overall separation plan and client decisions.
What affects the separation timetable?
The timetable depends on the perimeter, shared systems, data migration, procurement and access to seller services and evidence. We establish those dependencies when scoping the programme. The agreed delivery date must reflect them, and material changes need an explicit assessment of their effect on cost, continuity and timing.
For buyers, sellers and their advisers
The service supports private equity and corporate buyers acquiring a business from a shared estate, and sellers responsible for separating an operation. Divestiture IT separation also creates technical questions for legal advisers about service scope and exit dependencies.
Start with the perimeter, the completion date and the services the business cannot yet operate without. We can then discuss the route to Day 1 and out of the TSA.