News & Press
Alex Korda, Global Deals anlayst, on the latest SPAC deals and why investors should be cautious. With CNBC’s Melissa Lee and the Fast Money traders, Guy Adami, Tim Seymour, Karen Finerman and Steve Grasso.
The Edge’s SPAC Study is available to partners on the client portal and by request for non-partners.
On February 18, 2021, The Edge CEO & Founder Jim Osman highlighted three value catalyst situations to watch in 2021 at the MoneyShow Virtual Expo, as well as detailed how The Edge tracks and advises on similar ideas for investors. Please see below for the full recording of the presentation. The slides are available on request.
Blank-check companies that find targets in the consumer defensive and industrial sectors are the most profitable for investors, a new study shows.
About 80% of SPACs that use proceeds from their initial public offering to buy a consumer-defensive firm go on to outperform their sector within six months, according to The Edge Consulting Group. Industrials acquisitions are among the best performers during the first six months in particular, according to the study of 150 SPAC deals completed between 2015 and the end of 2020.
The longer a portfolio holds a special purpose acquisition company, the worse it’s going to perform, according to a new study by a special situations research firm.
Most SPACs lose money after finding a company to acquire, and they do so at an accelerating rate over the 12 months that follow a merger. That’s according to The Edge Consulting Group, a team of analysts that covers special situations, which researched 115 SPACs that closed acquisitions between 2015 and the end of 2020.
Barron’s – By Nicholas Jasinski, February 5, 2021
If you wait until a blank-check company completes its merger to invest, you’ve missed the bulk or all of the deal’s upside. That’s the core finding of a recent study of SPAC—or special purpose acquisition company—returns over the past five years.
The Edge Consulting Group, a research firm that counts money managers and institutional investors as clients as well as offering a service for individual investors, looked at 115 completed SPAC mergers from 2016 to the end of 2020. They found that 65% of their stocks had declined a month after their merger closing, and 71% were down a year later.
Activist trading during the pandemic will lead to big shakeups in the year ahead for consumer, health and financial stocks, according to a special situations research firm.
“Moving forward, we believe these are the sectors where activists are going to be involved in, pushing for spinoffs, M&A activity and management overhauls as the market’s recovery continues,” The Edge deals analyst Alex Korda said in a phone interview.
Barry Diller of IAC is set to reap great rewards from his 15-year tech seed-and-harvest strategy of taking Vimeo public by June 2021. Back in 2004, omnipotent visionary Diller, 78, knew he was on to a good thing when he made inroads with Rochester Institute of Technology students Jake Lodwick, now 39, from Baltimore, and 38 year-old Zach Klein from Rochester, NY.
Back then, Vimeo was a side project for the small team at Connected Ventures, who were focused on sharing site CollegeHumor.com. Four years on from Millennium Bug Y2K losses, investors were also counting the cost of the dot.com crash and many didn’t have the stomach for new tech – never mind mobile video. IAC purchased a majority stake in Connected Ventures for over $20 million in 2006 and eventually the founders stepped back.
Now in 2020, Vimeo has a $2.75 billion valuation and IAC has had ten successful spins under its belt, and The Edge believes Vimeo with its 41% growth in revenue from 2019 is set for a stellar 2021.
Sportico – By Brendan Coffey, Dec 18, 2020
When Nassef Sawiris disclosed last week that he is the largest individual shareholder not named Dolan to own a part of the New York Knicks and Rangers, it raised a curious question: Why is an activist investor and Egyptian fertilizer billionaire taking equity in a company tightly controlled by Long Island’s Dolan family?
Sawiris disclosed in a mandatory regulatory filing that he owns 6.3 percent of MSG Sports, the holding company of the NBA and NHL franchises that trades under the MSGS ticker. His investment office, NNS Holdings, controls 982,098 shares today and will get another 247,386 in March through an agreement with an undisclosed counterparty, according to the filing.
The transaction is unusual because on the rare occasions Sawiris takes large positions in publicly traded companies, he’s agitating for change. It’s been five years since Sawiris had a stake in a U.S. company, according to Securities and Exchange Commission records. At that time, he got one investment, Martin Marietta Materials, to buy his other, Texas Instruments—a company he long called for to be sold. The transaction probably doubled his money. In 2015, he partnered with an activist fund to buy up shares in Germany’s Adidas, getting him in the door to address its board in fluent German and advocate for improvements. Shares have quintupled since. An Irish brewer, a Swiss cement maker and a Spanish engineering firm are other companies in which he’s taken activist stakes in recent years.
“In MSGS, he won’t be able to do that,” Jim Osman, founder and CEO of consulting group The Edge, a securities research firm specializing in special situation stocks, said in a phone interview. “Why? Because the dominant voting position of the Dolans is around 70%. The Dolans don’t really get pushed around.”
One notable group is missing from the list of buyers amid the stock market’s relentless advance: corporate executives.
Earlier this year they timed the March market trough, scooping up shares of their own companies at the fastest pace since 2009. Come December however, with institutional and retail traders pumping record cash into exchange traded funds that track equities, insiders are still selling shares and in levels that have preceded prior market corrections.