TSA Duration, Cost and Stranded-Cost Benchmarks: A Sourced Reference

By the MeridianCogent team — built from working with integration offices, separation leaders and PE operating partners on M&A execution. This is a reference page, not an argument. We built it because we kept re-deriving the same numbers from the same handful of sources across our own work, and a single sourced table didn't exist anywhere we could find.

Every number below traces to a named source. Where sources disagree, we show both rather than picking one. Where a figure is a range rather than a point estimate, we show the range rather than collapsing it to a false-precision average. This page will be updated as better data becomes available — if you have a source we should include, or a figure that has moved, tell us at hello@meridiancogent.com.

TSA duration by workstream

Duration figures are the most cited and least consistent numbers in carve-out planning, largely because "duration" gets measured differently across sources — some report the base term as signed, others report actual elapsed time including extensions. We've noted which is which where the source specifies.

Workstream	Typical base term	Source basis
IT infrastructure	10–16 months	Industry TSA structuring analysis (BD Emerson); consistently the longest-running workstream across sources
ERP / accounting systems	8–12 months	BD Emerson; corroborated by carve-out ERP case data (Pemeco Consulting)
HR / payroll	6–10 months	BD Emerson
Customer support	6–9 months	BD Emerson
Procurement / supply chain	5–8 months	BD Emerson
Tax filing	4–8 months	BD Emerson
Treasury	3–6 months	BD Emerson
Marketing / brand co-use	3–6 months	BD Emerson
Overall range, standalone acquisitions	3–6 months per workstream	Dealroom carve-out timing analysis
Overall range, complex parent carve-outs	6–24 months	KPMG carve-out guidance
Overall range, public-to-private deals	12+ months on finance workstreams	KPMG carve-out guidance, citing added tax and regulatory complexity

Reading this table correctly: duration varies more by deal type than by workstream category. A standalone private acquisition with narrow TSA scope and a public-to-private take-private with full finance and tax entanglement are not comparable, even when the workstream labels match.

TSA extension and step-up pricing

This is the number practitioners ask about most and the one with the widest genuine variation, because extension pricing is negotiated per-deal rather than benchmarked industry-wide.

Extension band	Typical premium over base rate	Source
First extension period	15–25% monthly premium	Industry TSA structuring analysis (BD Emerson, Dealroom)
Extended/legacy TSA periods	Up to 50–100%+ premium	Practitioner-reported step-up structures, cited in TSA advisory case material
KPMG-documented accelerated exit	2–3 months post-close achievable with disciplined pre-close readiness planning	KPMG carve-out guidance

The mechanism, not just the number: extension pricing exists specifically to punish delay. A service still running six months past its base term should cost meaningfully more than the same service at month one — if it doesn't, the pricing structure isn't doing its job. When you're negotiating a TSA, the step-up schedule matters more than the base rate.

Stranded cost ranges

The most consequential and least understood number in a divestiture, because it's a seller-side cost that shows up as a margin decline rather than a line item anyone budgets for.

Metric	Figure	Source
Stranded cost as % of divested unit's IT/overhead allocation	20–40%	BD Emerson stranded cost sizing analysis
Companies with profitability drop >3.3pp in year 1 post-divestiture	51%	Deloitte, analysis of divestitures over the past two decades
Median SG&A increase (relative) among affected companies	1.7 percentage points	Deloitte UK, "Unlocking value: approaching stranded costs in M&A"
Companies taking 4+ years to recover from that margin drop	3 in 5	Deloitte
Standalone cost vs. parent-allocated cost for shared services	Up to 200% higher	McKinsey carve-out cost structure analysis
Data readiness workstream cost, mid-market carve-out	€500k–3M	PortMux carve-out data readiness analysis; range driven by system count and complexity
Data readiness workstream duration	4–9 months	PortMux

The compounding trap: a stranded cost discovered at month 3 post-close is a manageable line item. The same cost, unaddressed, reallocated across remaining business units by month 18, is invisible — which is precisely why the median recovery time is measured in years rather than quarters.

Deal volume and structural context

Numbers that explain why the above matters at the scale it does.

Metric	Figure	Source
Buy-side carve-outs as % of all M&A deals >$100M (2018–2023)	~28%	McKinsey
Large deals including a carve-out/divestiture component (2026)	70–90%	Deloitte 2026 Global Divestiture Survey and M&A research
Carve-out deals failing to create underwritten value	~1 in 3	McKinsey
Top-quartile vs. average carve-out MOIC (data since 2012)	2.5x vs. 1.5x	Bain & Company
2026 Global Divestiture Survey sample size	979 sellers, 569 buyers	Deloitte
Top seller-side post-close pressure, per that survey	Stranded costs, alongside TSA complexity and financial reporting	Deloitte
Top challenges in carve-out integration, per Bain's 2025 practitioner survey	Cultural differences and process/technology issues, ahead of TSA negotiation and talent retention	Bain & Company, 2025 M&A Practitioners Outlook Survey

Change-of-control and consent timing

Less quantified in public research than TSA and stranded costs, but the mechanics are well-documented by legal practitioners.

Item	Detail	Source
Standard deemed-consent fallback period	30 days	Standard drafting practice cited across contract practitioner guidance, where a "not unreasonably withheld" clause sets no explicit deadline
Government contract novation regime	FAR Subpart 42.12; separate approval process, not a negotiated commercial consent	Federal Acquisition Regulation
HSR filing threshold (as of Feb 2026)	$133.9 million transaction size	Federal Trade Commission, 2026 HSR thresholds

What we couldn't find good public data on

In the interest of the same standard we hold everything else to: cutover and hypercare cost data, and integration governance/workstream structuring benchmarks, are both areas where the available material is practitioner guidance rather than quantified research. We're not publishing invented percentages to fill that gap. If you know of a genuinely sourced figure in either area, we'd want to include it — email us.

How we use this ourselves

This table is the backbone of several of our own articles — what a TSA actually is, the real cost of a late exit, and stranded costs each draw on a subset of it. We built the full reference because assembling it piecemeal, article by article, meant re-finding the same handful of sources every time. If it saves you the same trouble, it's done its job.

Primary sources referenced throughout: McKinsey & Company (carve-out deal analysis 2018–2023; carve-out cost structure and value-creation research); Bain & Company (carve-out MOIC data since 2012; 2025 M&A Practitioners Outlook Survey); Deloitte (2026 Global Divestiture Survey, n=979 sellers/569 buyers; UK stranded cost research; divestiture profitability outcomes research); KPMG (carve-out guidance); BD Emerson (TSA structuring, IT separation and stranded cost sizing analysis); Dealroom (carve-out timing analysis); PortMux (carve-out data readiness research); U.S. Federal Trade Commission (2026 HSR thresholds); Federal Acquisition Regulation Subpart 42.12.