Sum of the parts analysis (SOTP), or break-up analysis, is a method of valuation of a multi-divisional company,

holding company A holding company is a company whose primary business is holding a controlling interest in the Security (finance), securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own Share ...

, or a conglomerate. The essence of the method is to determine what divisions would be worth if the conglomerate is broken up and spun off or acquired by another company; see Conglomerate discount. The analysis calculates a range of values for a conglomerate's equity by summing the value of its individual business segments or divisions to get the total conglomerate's enterprise value. The equity value is then calculated by subtracting net debt and other non-operating adjustments.

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