Buying Back Spinoffs
from the what-once-seemed-like-a-good-idea... dept
Here’s a NYTimes article talking about the many companies that are suddenly deciding now is a good time to buy back the company they spun out a few years ago. It makes sense. Back then, the spin out would raise a ton of money to do stuff – and now those companies are cheap (very cheap). The article also talks about a legal judgment that has also made it easier for parent companies to take back over their subsidiaries, without necessarily going through a big process to prove the deal is fair. I wonder, if the economy really bounces back, if we’ll see a trend to re-spinout companies that were spun out and bought back. It will be the corporate yo-yo.
Comments on “Buying Back Spinoffs”
Spins
We are also seeing a need for spin-outs now as the economy worsens and the parents need the cash. Or, the parents and in trouble and the management team wants to spin out the company. Our team is working on two such deals. We have room for more, if any one has ideas or knows of potential spinouts, contact me.
Mike Clouser, Founder, HVP clouser@ureach.com
650.544.8266
The corporate yo-yo? I like that!
Maybe you just coined a new buzz-phrase 🙂
Re: The corporate yo-yo? I like that!
corporate yo-yo = vacillating equity.
Much like many equities we know in the public marketplace. Key to success is to buy low and sell high; then short sell when high. More patience required. More effort. But the potential returns are big.