Would like to know if anyone here has considerable experience investing in spinoffs? I see an investment opportunity on the horizon but work in PE and am worried I understand too little about the actual mechanics although I do know a thing or two about the sector. Would appreciate if anyone PM'd me and we can discuss privately instead.
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What's there to know? If it's a spin and you own the stock, you'll get a piece of the new company. If it's a split-off, you'll have the option to exchange your shares of the old company for the new company (i.e. Pfizer and Zoetis). You can search for spin-offs directly on the SEC EDGAR site somewhere, spinoff-s are labeled as 12B's or 10-12B
http://macabacus.com/restructuring/spin-offs
Investing in spin offs is not all that different from any other investment. Read the form-10.
How will the management be incentivized? Will there be irrational selling? How big will the spin be? What were the motivations behind the spin?
Just review Greenblatt's book, or watch some of his special situation lectures. PM me, I think I still have links.
Try to estimate intrinsic value, and buy with a margin of safety.
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