In the middle of 2014, Relational Investors was busy notching another activist victory, this time at Timken (TKR), while also building up the case on its newest target, The Manitowoc Company (MTW). In short, the firm argued that a foodservice business selling machinery to restaurants didn’t have any reason to be paired with a crane equipment business. As… Read More »
Crimson Wine Group (CWGL) dropped a 134 word bomb today with the news that as of November 3rd, CEO Erle Martin was ‘no longer an employee’ of the company. The company slipped the news in a brief 8K filed with the SEC and offered no additional details on the move, and issued no press release. The board is… Read More »
Kimberly-Clark (KMB) officially completed the spinoff of its health care business, Halyard Health (HYH). The new company began trading ‘regular way’ on the NYSE today under the ticker ‘HYH’ and Kimberly-Clark shareholders as of the date of record should have received 1 HYH share for every 8 KMB shares owned. While the parent company’s press release was pretty muted,… Read More »
Less than a month after being spun off from Automatic Data Processing (ADP), CDK Global (CDK) has already attracted the interest of an activist investor. Sachem Head Capital Management, a firm led by Bill Ackman protege Scott Ferguson, has amassed a 9.8% stake in the company and is ‘seeking talks’ with management. This must be some type of record.… Read More »
Sorry, Mr. Loeb, it looks like it’s only going to be $219 per share for Amgen (AMGN). The biotech leader hosted a business update session yesterday and CEO Robert Bradway wasted no time in addressing the proverbial 800lb gorilla in the room. Within his opening remarks, Mr. Bradway noted that although they understood the pressure to break up, the company… Read More »
The end of the month is jam packed with spinoffs which means that the major indices will be making some changes as well. In this case, two S&P 500 companies, Agilent (A) and Kimberly-Clark (KMB), are spinning off units which will join the S&P Midcap 400: Keysight Technologies Inc. (NYSE:KEYSwi) will replace Universal Corp. (NYSE:UVV) in the S&P… Read More »
Despite being independent for a mere five months, Civeo (CVEO) has sure generated a lot of excitement. Many anticipated that the company, a spinoff from Oil States International (OIS), was destined to become a REIT in order to better distribute its income. REIT status would also theoretically offer the company a more premium market multiple, boosting its price.… Read More »
Speculation began almost immediately after Dan Loeb’s Third Point impressively raised $2.5b in just two weeks this summer. Who would the new targets be? Existing investments? Foreign companies? One new mark was just identified in the fund’s most recent quarterly letter as Amgen (AMGN), the $100b+ market cap biotech giant. The letter, which is worth a read in its entirety, suggests that… Read More »
At the beginning of the year, QEP Resources (QEP) unveiled a few strategic initiatives including the sale of its non-core assets and the spinoff of its midstream business, Entrada Midstream. The plan was concocted amidst activist pressure (Jana Partners recently exited QEP though) and the idea was to increase the company’s focus on its upstream business and deliver better… Read More »
The Babcock & Wilcox Company’s (BWC) board of directors are currently huddled around a spreadsheet filled room trying to figure out if separating its government & nuclear operations from its power generation business makes sense. At least that is how I imagine their ‘evaluation’ process although the reality probably includes a whole bunch of advisors doing most of… Read More »
With spinoffs becoming even more popular, it’s worth remembering that these transactions affect lots of people and are actually quite complicated. We previously some highlighted cultural and morale issues that may arise during the process, but there are plenty more that we haven’t touched on. There is a reason the timeline from announcement to completion is typically 6-18… Read More »
Last week, we wrote about the nosedive in Civeo (CVEO) shares following lousy guidance and the announcement that the company would redomicile in Canada as a C corp instead of pursuing REIT status. Although the logic seemed reasonable, the decision was somewhat surprising as the REIT conversion seemed to be viewed as a big value driver by large, activist shareholders such… Read More »
Earlier this year, Kimball International (KBALB) unveiled plans to break up the oddly paired family business by separating its contract electronic manufacturing business, Kimball Electronics, from its furniture business. Well, with board of director approval, the spinoff is now official. The transaction is set for the end of the month (October 31st) and both Class A & B shareholders will… Read More »
California, the great state known for its warm weather and environmentally friendly laws is about to get its own dedicated oil and gas business. Yes, you read that correctly. On December 1st, the California Resources Company (CRC) will begin trading on the NYSE as an independent entity after Occidental Petroleum’s (OXY) board of directors formally approved its spinoff last week. OXY… Read More »
Drama and alcohol seem to go hand in hand (especially on reality TV) and the wine business is proving to be no exception. The end seemed all but nigh for Australia’s struggling Treasury Wine Estates (TWE.AX) when two different private equity firms, KKR/Rhone and (allegedly) TPG, bid A$5.20 per share for the company. That ~$3.15b valuation already represented a… Read More »