Answer:- A spin-off is when a new company is created from the subsidiary or division of an existing (parent) company. The parent company creates a completely separate entity and issues new shares of the new entity to its existing shareholders. A spin - off distributes shares of the new subsidiary to existing shareholders. A split-off is when a new entity is created from the parent company and shareholders of the parent company exchange their shares for the newly created entity. A split-off offers shares in the new subsidiary to shareholders but they have to choose between the subsidiary and the parent company.Spin off also offer its existing shareholders a discount to exchange their shares in the parent company for shares of the spinoff. For example, an investor could exchange $100 of the parent's stock for $110 of the spinoff's stock.

A split-off is a corporate reorganization method in which a parent company divests a business unit using specific structured terms. In a split-off, the parent company offers shareholders the option to keep their current shares or exchange them for shares of the divesting company.

Difference between spin - off and split-off are as follows:- Spin-off and split-off are components of divestiture, which involves dividing a company or selling part of it to another company leading to the creation of a separate branch.

(1) The difference between Spin-off and Split-off is that in a spin-off, the parent company distributes the shares of the divested company to the existing shareholders, whereas in the case of a split-off, stocks of the divested company are transferred to the parent company.

(2) In a spin-off, shareholders enjoy shares of two companies, whereas, in a split-off, shareholders exchange their stocks for new shares of the subsidiary.

(3) In a spin-off, the business division leads to the creation of an independent company from the parent company which operates independently.Split-off is the condition which the shareholders in the holding company have shares in a subsidiary which is split-off for exchange of shares in the holding company.

(4) Spin off Create a separate identity for a new firm. Split-off Distinguish transactions between core business and the new division.

(5) In case of spin off, the shareholders in the parent company are offered the share of the spun off entity on pro rata basis, whereas in case of split off, the shareholders in the parent company are offered the shares of split off entity only in exchange of that of the parent company.

Conclusion:-So, it can be seen that both spin off and split off are recognized as one of the best tools for corporate divestment. Both the arrangement help companies build a more efficient and effective corporate structure. Companies go for spin offs when they intend to create a separate identity for the spun off entity, while they go for split offs when they want separate their core business from the subsidiary.