Disclosure: The author owns shares of SLE and YHOO

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Nobody Doesn’t Like Sara Lee- Dan Loeb and John Paulson Buy Ahead Of Spin is a post from Stock Spinoffs - Finding Value in Special Situations. All Rights Reserved.

While a .6% stake is certainly not enough to singlehandedly force change, it sounds as though the company is receptive to Relational’s concerns(though we don’t know what those are). Perhaps we will soon see a standalone Frito-Lay, on its own, in the world.

Disclosure: The author holds no position in any stock mentioned

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“I am pleased to announce that we are on track to spin-off the Coffee & Tea business by June 30. Significant progress has been made in the last quarter with the IRS private letter ruling, an F-1 prospectus filing for Coffee, the successful bond redemption and tender offers and the investor day for Coffee Co (D.E MASTER BLENDERS 1753),” said Executive Chairman Jan Bennink. “Both companies are in full preparation to become highly successful pure play companies. Sean Connolly, the new CEO for Meats, is finalizing his strategy and his new management structure, which will be presented to investors shortly. Michiel Herkemij, appointed as CEO for Master Blenders in December, has presented his strategy to investors and has added a supply chain executive and a regional head for Western Europe to his executive team. The Boards for the new companies will be announced in May.”

Chief Executive Officer Marcel Smits added, “I am pleased to report that Meat Co showed continued improvement in volume trends, achieved SG&A reductions and launched new innovation in the third quarter. The Coffee & Tea business performed well in its main markets with underlying margin improvement, and is gearing up for significant innovation. Activity levels in both companies increased during this period as the corporate headquarters operation continued to be scaled down. In addition, both businesses worked through manufacturing inefficiencies that impacted results. Positively, after two years of steep commodity cost increases, we finally see a stabilization and, in the case of coffee, a reversal of raw material trends. For the first time in two years, both businesses recovered their commodity cost increases and will see further benefits in Q4, particularly in coffee. We are confident that we will achieve our guidance, at the low end of the range for sales and operating income, as we continue to build two stand-alone businesses.”

Disclosure: The author owns shares of SLE

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Sara Lee Spinoff Moves Along, Expected By June 30 is a post from Stock Spinoffs - Finding Value in Special Situations. All Rights Reserved.

Disclosure: The author holds no position in any stock mentioned

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Disclosure: The author holds no position in any stock mentioned

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opined on the prospects for ConocoPhillips(COP) and its new progeny, Phillips 66(PSX). Mr. Cramer compared the spin to last year’s similar transaction involving Marathon Oil(MRO), briefly analyzed the two parts, and concluded that the gains have already been had.

“Now that ConocoPhillips has broken itself up, I think the opportunity here has come to an end, just like with Marathon Oil, where the stock made you a bundle in the lead up to the spin off, but afterwards both stocks were dead money,” Cramer said. “Sometimes the best decision is to just move on and forget about it.”

Dicslosure: The author holds no position in any stock mentioned

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Cramer: Opportunity Has Passed In ConocoPhillips, Phillips 66 is a post from Stock Spinoffs - Finding Value in Special Situations. All Rights Reserved.

than its stock.  The venerable company announced this week that it has begun a strategic review which may result in one or more spin offs.

Controlled by 88 year old billionaire Chairman David Murdock(he plans to live to 125) who bought the company out of bankruptcy decades ago, Dole is burdened with debt and well below the $12.50 price of its 2009 IPO. As of March 24th, LTM Total Debt/EBITDA is still a whopping 5.3x and Total Debt/Equity is 188%. The debt is a legacy of Mr. Murdock’s privatization of the company via a heavily leveraged LBO nearly 10 years ago. While the IPO was supposed to pare down the debt, it priced lower than expected and quickly sank amidst leverage concerns.  This poor performance has led the company down a path which one analyst says may deliver a 58% gain.  Though the company provided scant details, speculation abounds that the company will spin off its profitable packaged food business with debt to improve the balance sheet of the fresh fruit and vegetable business.

Another possibility is that the company could sell or spin its extensive Hawaiian land holdings which may be worth $400 million. Interestingly, Dole was formerly a part of Castle & Cooke, one of Hawaii’s “Big Five” companies that controlled the Territory.  Alexander & Baldwin(ALEX), another of the “Big Five” has also announced its intentions to split off its Hawaiian land business from its other business.  If such a thing is possible, might a double reverse Morris Trust combining the two land companies make sense?

Disclosure: The author holds no position in any stock mentioned, dislikes pineapple, and has still never been to Hawaii

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any spinoff talk from the US automotive industry. It appears that is also the case across the pond as Daimler AG (DDAIF) CFO Bodo Uebber said in a recent roundtable discussion that the company is not considering a spinoff of its truck unit. Mr. Uebber noted the many synergies between the car and truck businesses such as hybrid technology and emerging market sales as a reason for the units remaining together. Additionally, Mr. Uebber denied that the company has been shoring up its takeover defenses.

Rumors of a potential spin emerged last September after a union leader announced that the company workers were opposed to any spinoff of the truck business. Apparently several large funds owning small stakes in the company had sought a break up of the company. Daimler lags its peers in several metrics and is trying to improve in order to catch up, but some, including Credit Suisse analyst Ardnt Ellinghorst, believe that the business would be best served by breaking up.

Disclosure: Author holds no position in any stock mentioned.

Daimler Plans To Keep On Truckin’ is a post from Stock Spinoffs - Finding Value in Special Situations. All Rights Reserved.

The firm sent a letter to Clearwater Paper (CLW) arguing that the company is significantly undervalued on a sum of

the parts basis. The company operates two divisions, consumer products (tissue paper) and pulp and paperboard. The firm estimates that the consumer products business should be worth between $990-1,440m while the P&P business is slightly less valuable at an estimated $770-960m. Putting those numbers together provides a range of $1,760-2,400 which is a range significantly higher than the company’s current market cap of ~$780m. While the firm acknowledges some of the issues and investor concerns, it believes these can be solved. SAC owns ~1.64m shares or 7.2% of the company and wields some serious clout so I imagine the letter will be taken seriously.

Although the filing merely seeks to “initiate…more dialogue” with management and makes no recommendations, I always think of spin-offs whenever I see ‘sum of the parts’ analysis mentioned. That may be because I write for this blog and am completely biased. Whatever the case, investors were excited and CLW popped close to 7% on the announcement. We will keep you updated as this situation progresses.

Disclosure: Author holds no position in any stock mentioned.

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SAC Gets Active, Takes Scissors To Clearwater Paper is a post from Stock Spinoffs - Finding Value in Special Situations. All Rights Reserved.

Nook business.  We’ve written elsewhere about the turnaround at Microsoft(MSFT). Today, both stories collide in an explosive way.

The two companies will create a joint venture to which Barnes & Noble will contribute its Digital and College businesses, and to which Microsoft will contribute $300 million for a 17.6% stake, implying a $1.7 billion valuation. Considering that Barnes & Noble had a closing market cap on Friday for its entire business of under $800 million, this deal is a game changer for the company, which has nearly doubled in premarket trading.

It is unclear what Barnes & Noble will eventually do with its 82.4% stake in the joint venture, but a spin off remains a possibility. In the meantime, this certainly takes a great deal of pressure off the company, and lengthens the runway for the company’s still nascent digital efforts.

Disclosure: The author holds no position in any stock mentioned

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