News & Press
The Edge Consulting Group CEO Jim Osman tells Proactive Investors the investment research company that focuses on company spin-offs has compiled a report suggesting Merck & Co (NYSE: MRK) spin-off its animal health business, as the animal health business generates around $40 billion in revenue, The Edge expecting this to rise to $65 billion in 2025.
Osman says there’s significant value to be held to create even more value for its investors if the pharma giant does indeed spin off this portion of the business.
Many investors will agree that 2018 was a wipe-out with algorithms causing chaos. As computers tried to find value, prompting never-before-seen swings, human investors were left counting the cost.
But there’s good news on the horizon as 2019 has the potential of decent returns for investors’ hard-earned cash.
Spinoffs and special situations, a niche of The Edge Consulting Group, are ripe for the picking, offering little-known low hanging fruit that can boost your portfolio big time.
By Drew Singer / Bloomberg News:
Large industrial, technology and healthcare firms could soon explore spinoffs to unload debt and stave off activists, according to a special situations research firm.
Elliott Management’s recommendation this morning for eBay to review its portfolio could be the first of many similar calls to action by activists in 2019. Other top candidates to divest non-core assets include AT&T Inc., Oracle Corp., Merck & Co. Inc. and Roper Technologies Inc., The Edge Consulting Group CEO Jim Osman said in an interview. The need for divestitures comes after a rush of acquisitions created heavy debt burdens and higher capital demands.
Breaking up may not be hard to do if Amazon’s Jeff Bezos is to be believed, but when it comes to companies – the special situations market is growing arms and legs. Now, as money managers scramble for value, legend George Muzea is partnering with trendsetting firm The Edge following the success of their quarterly Spinoff conference in NYC.
The veteran insider analysis expert with over forty years’ experience has worked with some of the world’s most prolific investors. Renowned for its success in monitoring, tracking and the scrutiny of global Special Situations and Spinoffs, Jim Osman (CEO of The Edge) is thrilled by the new partnership.
By Drew Singer / Bloomberg News:
A spinoff of Europe’s largest pure online classifieds firm could have 100 percent upside after its separation from Nordic media conglomerate Schibsted ASA next year, a fund manager argued Wednesday at a conference in New York. The same manager also voiced bullish sentiment for Kambi Group PLC, a Stockholm, Sweden-listed sports betting service based in Malta.
Schibsted was the subject of one of several presentations at a spinoff and activist investor conference hosted by The Edge Consulting Group, which benefits The Alzheimers Association.
By Antonella Ciancio / Global Finance:
Large companies around the world are breaking off pieces or breaking up in record numbers. Will the boom last?
Global conglomerates from the Americas to Europe to Southeast Asia are slimming down and muscling up to address activist investors’ demands for higher returns and improved operational performance—and, perhaps, to cash in before the decade-long bull run in equities peaks.
“Over the 10 years that we’ve been analyzing spinoffs, the bulk of activity in corporate breakups has been close to the bottom or near the top of an economic cycle,” says Jim Osman, CEO of The Edge Consulting Group. “While we are not calling the top of the market right now, we believe that the value in a lot of companies has been realized; and in order to provide even greater value, corporates as well as the activists we advise are examining ways that this can happen. Spinoffs are great for giving shareholders that.”
Soaring markets and the rise of shareholder activism have compelled companies to plan spinoffs at a rate unseen since at least 2008. There’s no end in sight for the frenzy as these new stocks keep finding ways to beat the market. More than 100 companies this year have announced plans for spinoffs on U.S. exchanges, a 54 percent increase from the same time last year, according to data compiled by Bloomberg. This momentum could continue regardless of how the broader market performs, according to Jonathan Morgan, a deals analyst at The Edge Consulting Group.
The Edge held the very first Spinoff conference in NYC on Wednesday, June 6 at the exclusive Penn Club on 44th St. to a packed room. With almost 100 money managers, The Edge debated where, if any, Spinoffs make money. The event was non-profit, and all donations went to the Alzheimer’s Association. We are proud that, together, we raised $5,500.
It was a great experience, and the thing I liked personally was that everyone was a winner. The charity had gained some much-needed funds, the audience got some great ideas and some fantastic food, and perhaps we can gain some new partners to help.
Benjamin Franklin said there were only two things certain in life: death and taxes. Some things may be obvious, but not quite certain. Insider selling is one of those in my opinion. As markets and companies become more in-line with fair value, it can become much harder to extract value from companies, particularly with the shift and impact in technology, governments, regulatory changes and the general environment. This can give rise to a few different variables that I’ve seen affect executives over time. Sometimes, this motivates them to do something with the company for the good of the shareholder.
Here is what I think. There are two things certain in the investment world that you cannot spot until much later: Selling by insiders who know bad news is coming or executives straight up cooking the books.
Most of you well know that I have been calling the death of the big banks for years. They are institutions that are beyond their sell-by date. They kill you on fees and are just not a part of this new world where everyone wants to see the value before they pay a dime. Even down to everyday stuff, you are forced to pay what they demand in terms of banking charges.
Having said that, times are changing. Spotify, the digital music and video streaming service, is coming to the market in an unconventional way – very similar to a Spinoff, and that’s why I like it. The non-IPO as it’s being called won’t be offering new shares to investors, it won’t be constrained by a lock-up enforced by underwriters, and it won’t be marketing its offering behind closed doors to a select few. Result? A Spinoff-type situation that is very under-covered. It’s under-covered because the big banks aren’t making any money out of it!