How do you treat A/D in a carve-out when the target is only a division of the seller group?

For a carve-out, standalone target net income must be built first. Remove seller group allocations that will not continue, add true standalone public-company or corporate costs, include TSA costs, stranded-cost sharing, and new financing / tax assumptions. Synergies should be based on the buyer's integration plan. The biggest risk is using historical allocated EBITDA that does not reflect standalone economics.