When a Fortune 500 parent spun off a business unit, both sides inherited a single Microsoft Enterprise Agreement neither could cleanly divide. The carve out closed with two right sized contracts, no duplicated entitlement, and a transition services agreement that ended on schedule. This is how the estate was separated under deal timeline pressure.
A diversified parent divesting a business unit of roughly eight thousand employees into a standalone company. Both entities sat under one Enterprise Agreement, one tenant architecture, and one consumption commitment. The transaction documents assumed a clean split that the licensing reality did not support, and the transition services agreement carried a hard end date. The practice was engaged to design and execute the separation.
The parent had built its Microsoft estate as a single integrated environment: one Enterprise Agreement, one Azure consumption commitment, a shared tenant carrying the productivity footprint and the security stack for the entire organization, and a developer tooling estate that crossed business unit lines. None of it had been designed to come apart. When the board approved the divestiture, the transaction documents treated the technology separation as a routine workstream, allocating a transition services period during which the spinoff would continue to operate under the parent's contracts while it stood up its own.
The reality underneath the deal model was harder. The shared Enterprise Agreement could not simply be photocopied. Entitlement counted against the parent's volume, the spinoff had no purchasing history of its own and therefore no pricing leverage, and the consumption commitment had been sized to the combined entity. Left unmanaged, the most likely outcome was the worst one: both companies provisioning overlapping entitlements during the transition, the spinoff signing a first standalone agreement at unfavorable rates because the clock had run out, and the parent carrying a commitment sized for an organization that no longer existed.
The transition services agreement made the timeline unforgiving. A transition services agreement is not a grace period. It is a meter running on someone else's terms, and it ends whether or not the separation is finished.
The engagement started by mapping the shared estate to the two future organizations rather than to the one that existed today. The practice reconstructed consumption by business unit across the productivity footprint, the Azure commitment, the security stack, and the developer tooling, producing a defensible picture of what each side would actually need as an independent company rather than what the combined entity had bought. That separation of usage was the foundation everything else stood on.
From that baseline the practice designed two contracts in parallel. The parent's Enterprise Agreement was resized down to its post divestiture estate, removing a commitment it would otherwise have carried for an organization it no longer owned. The spinoff's first standalone agreement was structured from the consumption data and supported by peer pricing for a company of its size, so it entered its first Microsoft negotiation with leverage it had no purchasing history to earn on its own. Crucially, both contracts were sequenced against the transition services timeline so that the spinoff was operating on its own paper before the meter stopped, not scrambling after it.
The duplicate entitlement risk was engineered out rather than reconciled later. By assigning each shared component to one side or the other before provisioning, the separation avoided the overlap that turns a carve out into a double payment. The cheapest license in a carve out is the one you never provision twice.
The separation closed with the parent on a $38.4M Enterprise Agreement resized to its standalone estate and the spinoff on its own $19.6M agreement priced as if it had a purchasing history it did not yet have. Against the $58M combined footprint, the structure avoided an estimated $11.3M in duplicated entitlement and overcommitment that the default transition path would have produced. The transition services agreement ended on its scheduled date with both companies fully operating on their own contracts.
The less visible outcome was strategic independence. The spinoff emerged from the transaction with a contract sized to its real estate, a consumption baseline it could carry into its next renewal, and a Microsoft relationship that started from a defensible position rather than a rushed one. The parent shed a commitment it would otherwise have paid for and entered its next renewal with an estate that finally matched the company it had become. Neither side inherited the other's overhang.
The engagement reflects the firm's broader record across Microsoft contracts: more than $420M in cumulative client savings, over 340 engagements delivered, and an average 79 percent reduction in audit financial exposure, built on 20+ years of combined practice depth across the Microsoft estate. The figures above are verifiable on a reference call arranged through the practice.
The practice supports divesting parents and newly independent companies on separating shared Microsoft estates, sizing two contracts in parallel, and finishing before the transition services agreement expires. Two analyst calls, no pitch, and an honest read on the separation.