A Weekly Update on Happenings in Special Situations
  • M&A activity in the cybersecurity space is frothy. 3 large deals last week – Datto $MSP sale to Kaseya, SailPoint $SAIL sale to Thoma Bravo, and Barracuda sale to $KKR.


  • Atlantia (BIT: ATL) received a $63bn buyout proposal from the Benetton family and Blackstone $BX in what would be the 2nd largest global M&A deal of the year.

  • Kohl’s $KSS said bidders are refining their offers and securing financing; Franchise Group $FRG reportedly joined the process.

  • In a continuation of recent trends, increased incidence of M&A activity from across the pond. CareTech (LSE: CTH) has competing bids. Ideagen (AIM: IDEA) is the subject of takeover interest. Ocean Outdoor (LSE:OOUT) is in sale talks.

  • Nielsen $NLSN investor WindAcre now owns 25% of the company, and still plans to block its sale.

  • Peloton $PTON activist Blackwells Capital reiterated its call for a sale of the company.

  • Guess? $GES activist Legion Partners received support from ISS and Glass Lewis in ongoing proxy fight.

  • Hearing rumors that Gap $GPS may be pressured to spin-off its Athleta biz.
The Most Important News in Special Situations This Week
  • It’s the season for annual general meetings and several high-profile proxy fights are ongoing. US Foods $USFD appointed two new directors to the board amid a fight with Sachem Head. Kohl’s $KSS criticized Macellum as its sale process with Goldman Sachs continues. Guess $GES is facing a fight with Legion Partners and Ventas $VTR with Land & Buildings.

  • Hasbro $HAS turned down a settlement offer from Alta Fox in their ongoing proxy contest. Alta Fox’s Connor Haley told Yahoo, "It would not surprise me at all if somebody came around and said look, we're gonna bid for the whole company in a hostile way.”


  • An increase in investor activism campaigns is perhaps best epitomized by Carl Icahn, who is waging simultaneous proxy contests at Kroger $KR, McDonald's $MCD and Southwest Gas $SWX. Previously in Q1, Icahn announced settlement agreements w/ Delek $DK and Dana $DAN.


  • Global M&A fell to the tune of double digits in the first quarter, but 90% of the drop in domestic deal volume was attributable to a decrease in SPAC merger activity (see graph below). Evolving dynamics have created pockets of high activity, like in community banks, UK-based companies, real estate, and gaming.

  • Nielsen $NLSN announced its sale to Elliott Management (Evergreen Coast Capital) & Brookfield Business Partners $BBU in a $16bn transaction ($28 / share). Nielsen had previously rejected a $25.40 / share offer and announced a share buyback.

  • M&A is active in the UK: Ted Baker $TED.L rejected two takeover bids by Sycamore (Sycamore has until April 15th to submit a revised proposal) and a second activist investor has emerged in their stock. Pearson $PSO rejected a third proposal from Apollo $APO, ending the private equity firm’s pursuit.


  • Schweitzer-Mauduit $SWM announced an all-stock merger of equals with Neenah $NP, creating a leader in specialty materials. Interestingly, both companies first emerged as public companies by spin-offs from Kimberly-Clark $KMB.

  • UnitedHealth $UNH announced the acquisition of LHC Group $LHCG for $6.4bn. The deal comes amid regulatory concerns regarding UnitedHealth’s pending acquisition of Change Healthcare $CHNG.


  • Busy week in community bank M&A activity with 4 deals: Apollo / Seacoast $SBCF, Bank of Jackson Hole / National Bank Holdings $NBHC, Charter Bankshares / Nicolet $NCBS and Randolph Bancorp $RNDB / Hometown Financial.

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The $HAS stuff is really interesting. I have a smaller, slightly more speculative, position in $HAS. I believe that despite the board snuffing the proposal (which was shocking), the investor base is going to be woken up and question that decision.

Adirondack Retirement Specialists, a Meaningful Shareholder of Hasbro, had the following statement:

"We were dismayed to see media reports indicating that the current Board of Directors rejected what appears to be a step forward toward adding value for Hasbro shareholders via a very reasonable settlement proposal from Alta Fox. If true, it is troubling to us that the current directors would reject a well-researched 2.5% shareholder’s input and candidates who have records of adding value at a time when Hasbro seems to have lost the market’s confidence. The Company’s shares are at a new 52-week low point, and it has a strategy that has led the business to lag the overall market and its major competitor over the past five years. For shareholders, we insist on a strategy that prioritizes the highest and best long-term allocation of capital and resources. In our view, Alta Fox’s proposal takes shareholders toward that goal. We intend to support the entire dissident slate as we believe that would be in the best long-term interests of shareholders if a contested vote is held at the 2022 Annual Meeting of Shareholders."
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Good morning contrarians! We aren’t out of the woods on Russia-Ukraine, or even close. As discussed yesterday, the Russian economy is very much behind the 8-ball and Biden could announce further sanctions in his State of the Union Speech tonight.

The conflict has impacted commodity supply chains pretty significantly, especially where Europe’s energy needs are concerned. If nothing else, it looks like buying any dip in commodities or commodity-related securities may be a wise move.

We also have retailers reporting earnings today, with Target ($TGT) just beating EPS but falling short of revenue estimates. Later we’ll hear from Kohl’s ($KSS), Nordstrom ($JWN), Ross Stores ($ROST), AutoZone ($AZO), and Urban Outfitters ($URBN). We also have Salesforce.com ($CRM), Baidu ($BIDU), Domino’s ($DPZ), Wendy’s ($WEN), JM Smucker ($SJM), and Hewlett Packard ($HPE). This all makes for a pretty busy earnings day that will in all likelihood be overshadowed by Russia-Ukraine.

Upcoming Earnings Calendar (Feb 28th - Mar 4th)
Hey guys! Here's the upcoming earnings calendar! Two of my holdings, $SE and $SOFI report next week, so I'll be paying significant attention to both. Other than that, I'm also interested in seeing what retailers like $TGT $BBY and $COST have to say about supply chain issues and inflation.

Good luck to everyone!

If you'd like an easier way to track earnings dates, you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.

MON:


TUE:


WED:


THU:


FRI:
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Upcoming Earnings Calendar! (Nov 15th-19th)
Earnings season is slowly coming to a close, but there are still several highly interesting events coming up. Here's next week's earnings calendar and what I'll for looking forward to.

  • $SE: insights on their global e-commerce expansion.
  • $NVDA: comments on their product availability and supply.
  • $WMT: Update on their Walmart+ membership and comments on inflation/labor shortage/supply chain issues.
  • $DLO although this stock is too richly valued for me, I like their business and I'm following it in case there's a good buying opportunity post-earnings.

Comment below which earnings report you are looking forward to the most!

Friendly reminder: you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.

Monday
Tuesday
Wednesday
Thursday
Friday
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Eric Pelnik's avatar
$266.4m follower assets
Earnings this week
📞Which calls are you most excited about?

A lot of consumer discretionary companies are reporting. I'm interested to see how consumer spending habits last quarter affected different companies' performance.

Monday, August 16th
$CMCM Cheetah Mobile
$TME Tencent Music Entertainment

Tuesday, August 17th
$LZB La-Z-Boy
$HD Home Depot
$WMT Walmart

Wednesday, August 18th
$RRGB Red Robin Gourmet Burgers
$BBWI Bath & Body Works
$NVDA NVIDIA
$TGT Target
$PGR Progressive
$HOOD Robinhood Markets

Thursday, August 19th
$AMAT Applied Materials
$BJ BJ's Wholesale Club
$KSS Kohls Corp
$FTCH Farfetch
$M Macy's
$PDD Pinduoduo

Friday, August 20th
$DE Deere
$FL Foot Locker

Sources: Business Insider, Google Finance, Yahoo Finance
Grace Gruber's avatar
$55.4m follower assets
Let’s Go Shopping: Authentic Brands IPO
The Mid-2000s called and they want their brands back.

Authentic Brands is a conglomerate of clothing stores that includes Aeropostale, Brooks Brothers, Forever 21, and Juicy Couture. They also own the rights and licensing to public figures & icons including, but not limited to Marilyn Monroe & Michael Jackson.

CNBC reports a valuation of $10B is being discussed, which means (as they very well pointed out) Authentic Brands would be valued higher than $UA, $KSS, $RL, and $DKS. This valuation seems quite high given how distressed these companies have been over the past decade. Blackrock has worked its wonders before, so nothing is off the table. When Blackrock invested in 2019, it was valued at $4B, inclusive of debt.

The S-1 is expected in early July and trading could begin later that month. I am a cynic, but definitely interested in learning more about this IPO as details come out.
These brands I feel are the classic "mall" brands, which over the past few years have been dying off. Personally, I buy from 3-4 (Rhoback and Vuori to name a few) online retailers that don't necessarily have brick and mortar stores but I still purchase from monthly.

If authentic brands started picking up these online companies I could become very interested.
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Eric Pelnik's avatar
$266.4m follower assets
Earnings this week
📞Which calls are you most excited about?

Monday, May 17th
$RIOT Riot Blockchain
$PLUG Plug Power

Tuesday, May 18th
$BIDU Baidu
$HD Home Depot
$M Macy's
$WMT Walmart
$SE Sea

Wednesday, May 19th
$SCVL Shoe Carnival
$TGT Target Corp
$LOW Lowe's Companies
$MANU Manchester United
$FUTU Futu Holdings

Thursday, May 20th
$PANW Palo Alto Networks
$KSS Kohl's
$HRL Hormel Foods
$RL Ralph Lauren
$PDD Pinduoduo

Friday, May 21st
$DE Deere
$VFC VF Corp
$BAH Booz Allen Hamilton
$FL Foot Locker

Sources: Business Insider, Google Finance, and Yahoo Finance
Kinda hard to feel like this matters in the short term rn 😬
but thank you for always posting 😍
also don’t own any of the above, so finally a break 🙏
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