Interesting Items for Tuesday, November 06, 2007
A couple special situation announcements top today’s interesting item list.
Entergy (ETR) announced it will spin-off its unregulated nuclear plants. Read this 24/7 Wall St. post for details. Also, see this SEC Investor post.
This is potentially a very interesting spin-off (however, like all spin-offs, it will ultimately come down to price) because of the nature of the assets being spun off, expected major differences in the amount of financial leverage, earnings volatility, regulatory environment etc. between the parent and the spin-off, and because of the joint venture services company.
The spin-off is planned for some time around the third quarter of 2008. Watch this one carefully. Study it; value it; then, see where it starts trading and whether you ought to buy it. This spin-off has the potential to be one of the most interesting opportunities of 2008.
This next special situation will likely garner a few more headlines than the Entergy spin-off, because of the personalities involved – yes, I’m talking about IAC/InteractiveCorp (IACI). The break-up is being discussed in major media outlets. You can learn the basics there.
Here are three posts on the subject:
Street Capitalist – Special Situation: IAC/InteractiveCorp Breakup
SEC Investor: IAC Splits Up Into Five
Controlled Greed – Does IAC/InteractiveCorp Splitting Advance Diller/Malone Story?
Finally, let me mention something that Rick Konrad wrote that mentions something that I wrote – the topic is formulaic investing:
Reflections on Value Investing: Formulaic Investing
Value Discipline: Some Thoughts on Formulaic Investing
Visit Reflections on Value Investing