This study explores the impact of capital redeployment in internal capital markets on a firm’s decision to disclose or withhold business segment information. It also investigates whether the relationship between capital redeployment and segment disclosure is moderated by the level of the firm’s unabsorbed slack. Additionally, it examines how diversification in related product markets affects the likelihood of disclosing business segment information. This study demonstrates that diversified firms that redeploy capital across business segments are more likely to disclose a greater number of sectors. This strategic disclosure approach aligns with the broader goals of diversified firms with redeployment capabilities, aiming to strengthen their competitive position by discouraging potential competitors from entering their markets. Furthermore, the negative relationship between capital redeployment and segment non-disclosure is weakened as the firm’s level of unabsorbed slack increases. Furthermore, firms diversifying in related product markets tend to disclose fewer sectors as their primary focus is safeguarding sources of synergy. These findings align with a unique dataset on the U.S. pharmaceutical industry from 1983 to 1992, covering diversification across three different industries within the U.S. medical sector and spanning a total of 85 product categories.