What is Disinvestment In business, disinvestment means to sell off certain assets such as amanufacturing plant, a division or subsidiary, or product

line. Some people usethe term divestiture, or to divest when discussing disinvestment.For example, an electric generator manufacturer might sell off its consumergenerator product lines and manufacturing facilities in order to raise moneythat can be used to expand its industrial generator product line.Another example is a consumer products company selling off a profitabledivision that no longer meets its long range goals. The proceeds from this disinvestment are then used to improve the companys financial position byreducing its debt.Investment refers to conversion of money or cash into securities,d e b e n t u r e s , b o n d s o r a n y o t h e r c l a i m s o n m o n e y . A t t h e s a m e t i m e , disinvestment involves the conversion of money claims or securitie s intomoney or cash.Disinvestments, also known as divestments, are processes utilized bycompanies when there is a need or desire to initiate a reduction in capitalinvestment. Essentially functioning as the polar opposite of an investment, theprocess of divestment involves selling off current investments in order togenerate assets that can be used to better advantage in some other manner.