There’s much value to be found in spins, but not every spin is a winner. That’s the reminder from YCharts’ Jeff Bailey, who took a recent look at ADT’s(ADT) “alarming” performance. Despite a strong, post-spinoff start, the company plunged and has underperformed on poor earnings. in October 2012, and after an initial rally ADT shares turned down. Cable… Read More »
The dance is finally over and Safeway (SWY) has found its suitor. After a lot of speculation, the grocer agreed to be acquired by Cerberus owned Albertson’s for ~$9b. While that would normally put the company in the hands of merger arbitrage players, the company still has some unfinished spinoff business. Back in 2012, the company announced plans… Read More »
After following the space for a few years, you start to notice a few companies which are best described as ‘serial spinners’. These companies have a rich history of spinoffs and some have even passed that tradition on to their kids leading to a few ‘grandchildren’. It would be interesting to come up with a ‘Spinoff Power Rankings’… Read More »
It’s been two and a half years since Xylem (XYL) was spun off from ITT Corp (ITT). Not a long time, but long enough for the company to hire its third CEO. Gretchen McClain, the CEO at the time of the spinoff, resigned abruptly last September amid poor results, and was replaced on an interim basis by Steven… Read More »
We’ve been quite remiss in not discussing Darden’s(DRI) plan to spinoff Red Lobster and the ongoing activist fight over the company’s direction. Both Barrington Capital with 2.8% of the company and Starboard Value, with 5.5%, have been sparring with the firm. Barrington had proposed that the the firm separate its low-growth brands, Red Lobster and Olive Garden, from… Read More »
Dover Corporation’s (DOV) spinoff of Knowles is set for tomorrow and S&P recently announced the resulting changes to its indices. Dover will remain in the S&P 500, but post-spin, Knowles will ‘drop’ to the S&P Midcap 400 where it will replace Apollo Investment (AINV). Interestingly, Apollo is getting the boot due to S&P’s new methodology rules excluding business development companies from… Read More »
That didn’t take long. Just a month after first publicizing his position, Carl Icahn fired another salvo in his campaign to break off PayPal from EBay (EBAY). Mr. Icahn sent an open letter to EBay shareholders informing them that he has uncovered ‘multiple lapses in corporate governance’ at the company and that ‘the complete disregard for accountability at eBay is… Read More »
Tribune’s (TRBAA) upcoming publishing spinoff is on track to be completed later this year and as part of the transaction, the new company will issue new debt in order to fund a dividend to the parent company. While not an uncommon feature of spinoff transactions, the move is drawing a lot of negative attention from news outlets and… Read More »
Noble Corp (NE) has finally unveiled the new name for its upcoming standard spec drilling unit spinoff. No fancy consultants used here, no Russian sex act, no Portmanteau. Instead the company went bold and set the bar high by naming the new company Paragon Offshore. No surprise coming from a company with the name Noble. In fact, the… Read More »
After Murphy Oil (MUR) announced a spinoff in late 2012, Deutsche Bank analyst Paul Sankey had a few ideas for whom the next spinoff candidates in the energy space might be. His top picks? Hess Corporation (HES) and Occidental Petroleum (OXY). Congrats Mr. Sankey, you deserve a nice pat on the bac,k because not one, but both companies… Read More »
Last September we noted that Tribune (TRBAA) was following the industry playbook and spinning off its publishing assets into a separate company. According to a recent article, the company is eyeing to complete the transaction sometime in the middle of the year, either Q2 or early Q3. At the time of the announcement, the company estimated that the… Read More »
For some reason, spins tend to cluster around the end of the month, and January 31st witnessed some impressive action with the completion of two separate transactions. First off, ONEOK (OKE) completed the spinoff of its natural gas distribution business ONE Gas (OGS). The new company is trading under the ticker ‘OGS’ and shareholders of ONEOK should have… Read More »
The Dover(DOV) Board has approved the company’s previously announced spin off of Knowles(KN). Dover shareholders of record as of February 19, 2014 will receive one share of Knowles on February 28 for every two shares of Dover that they own. Knowles, which will trade under the ticker KN, will begin regular way trading on March 3. Both stocks… Read More »
Last week, we reported that Illinois Tool Works(ITW) had decided to sell its Industrial Packaging Unit rather than spin it off. Now, the company has reached an agreement to sell the unit to the Carlyle Group for $3.2 billion. The deal values the business at 8.5 times EBITDA. This represents a continuation of a trend where conglomerates are… Read More »
When I say furniture, you say…electronics manufacturing? Such is the odd pairing at Kimball International (KBALB) which currently operates two pretty distinct segments: furniture and electronic manufacturing services. Apparently, this diverse lineup was just too much for investors to handle, so the company announced that it would break itself up and pursue a spinoff of Kimball Electronics. I… Read More »