Last January, Sears Holdings(SHLD), controlled by Eddie Lampert, spun off Orchard Supply Hardware(OSH). At the time, we were bullish on Orchard. We were wrong. Unfortunately, while the stock has plummeted, we held onto our small stake. Lampert, however has been smarter, as he has cut his stake in half over the past year. Orchard has struggled to maintain… Read More »
Another day, another story about a large shareholder pushing for a breakup. The latest target is pork company Smithfield Foods (SFD) which received a letter from one of its larger shareholders, Continental Grains, urging the company to hire an outside adviser and to consider ‘strategic changes’ including the possible breakup into three separate companies. Continental argues that since… Read More »
A quick update on a recent spinoff. Leucadia (LUK) completed the spinoff of Crimson Wine Group (OTC:CWGL) a few weeks ago and the new company has jumped around a bit as an independent company. A lot of people were down on the company and many of the comments on our earlier articles pointed to the company’s poor recent earnings, expected… Read More »
Earlier this year, Siemens(SI) shareholders overwhelmingly approved the spinoff of 80.5% of Osram at the company’s annual meeting. Or did they? Though it was reported that 98% of shareholders who cast votes were in favor of the spin off, a group of shareholders has now stepped forward to challenge the vote. While this lawsuit is pending, the company… Read More »
We wrote previously about the planned spinoff by Leucadia(LUK) of Crimson Wine Group(CWGL). There was much discussion and speculation as Lucadia’s managment are among the most successful investors of the last few decades, this was their personal project being spun off as a result of the merger with Jefferies(JEF), the distribution ratio of 1 share of CWGL for… Read More »
Illinois Tool Works (ITW) has been going through quite the transformation over the past year or so after being egged on by activist investor Ralph Whitworth. The company sold a 51% stake in its decorative surfaces division last year and last week it announced that it was ‘exploring strategic alternatives’ for its industrial packing unit. This seems to fit… Read More »
Earlier this week, Demand Media(DMD) announced plans to split into a domain registration business and a content business. Though the opportunity seems promising, it was difficult to evaluate without the numbers for the business broken out, which, to our knowledge, the company had not done publicly. We were pleased, then, to read the transcript of the conference call… Read More »
When United Online (UNTD) first announced plans to spin off its FTD floral business last summer, the company anticipated it would be completed this quarter. In November, the company hoped to complete the transaction by August. Yesterday, the company released its fourth quarter earnings, and now hopes to complete the transaction by the end of the third quarter.… Read More »
The trend towards tax-efficient divestitures continues with Axiall (AXLL) – previously called Georgia Gulf Corporation – obtaining PPG’s (PPG) former commodity chemicals business using a Reverse Morris Trust. The trend of using Reverse Morris Trusts to ‘sell’ divisions has been previously reported by Stock Spinoffs here. In the transaction, PPG created a short-lived spinoff, Eagle Spinco, and allowed… Read More »
M&A is back. Last week witnessed the return of some rather large deals including the $11b US Airways (LCC) takeover of AMR (AAMRQ), parent of American Airlines. The deal is expected to close later this year and you can click here for more details on the transaction. One of the many issues which remain to be sorted out… Read More »
Ever since its IPO, we have thought Demand Media(DMD) to be a strange beast- a content farm with a domain registration business bolted on. Well, the company announced today that it will be loosening those bolts and spinning off the domain registration business to shareholders. The company hopes to complete the spin in the next nine to twelve… Read More »
Some more spinoff news from the current earnings season. Dean Foods (DF) reported disappointing Q4 numbers, but buried within the press release were plans for its ~86% stake in the WhiteWave Foods Company (WWAV). Dean plans on spinning off a chunk of those shares to shareholders in a tax free transaction after its lockup period expires, likely at… Read More »
Time Warner(TWX) is no stranger to spinoffs. The company once known as AOL Time Warner lost the AOL(AOL) in what has proven to be a successful spin- much more successful, certainly, than the disastrous merger, perhaps the worst in American history, which brought the two firms together. Earlier in 2009, the company spun off Time Warner Cable(TWC). And… Read More »
Earnings season is always chock full of spinoff news. Valero (VLO) recently provided updates on its upcoming retail segment spinoff during its Q4 conference call and during a presentation at the Credit Suisse Energy Summit. PDF versions of the transcript & presentation can be found here. The new company, CST Brands, operates ~1,900 retail fuel and merchandise sites… Read More »
Leucadia (LUK) is one of those low key companies which has done a superb job for shareholders. The company has grown Book Value per share at an 18.5% CAGR and shareholder equity at over 19% since 1979. Not bad. No fancy homepage for this company, instead the spartan website offers up some links to the company’s SEC filings… Read More »