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   Strategies & Market TrendsSpeculating in Takeover Targets

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To: richardred who wrote (5250)7/15/2019 2:23:26 PM
From: E_K_S
   of 6084
Clabber Girl in Terre Haute will be laying off 25 employees starting Aug. 31, the company said Thursday.

The layoffs are to begin Aug. 31 and will continue through the end of the year. The employees have been notified and will receive severance packages, the company said.

Hulman & Co. on May 15 announced the sale of Clabber Girl to B&G Foods Inc. B&G, based in New Jersey, makes and distributes a broad range of food products, including Cream of Wheat, Green Giant, Ortega, SnackWell’s and others.

B&G paid $80 million for Clabber Girl, according to a U.S. Securities and Exchange Commission filing.

Cost reduction synergies. Tested mylti year low today too.


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To: richardred who wrote (5293)7/18/2019 9:41:18 AM
From: richardred
   of 6084
Didn't take long for a buy back into energy. I couldn't resist buying back into ECA on the new low. A Trade or long it doesn't matter to me.

Oh boy- Hope this doesn't become a trend

Berkeley becomes first U.S. city to ban natural gas in new homes.

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To: richardred who wrote (5359)7/18/2019 9:48:53 AM
From: richardred
   of 6084
HBIO- Speculation- I've got new company now

BRIEF-Paul Solit Reports 5.7% Passive Stake In Harvard Bioscience Inc
BY Reuters
— 2:58 PM ET 07/17/2019

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To: richardred who wrote (5373)7/18/2019 11:17:39 AM
From: richardred
   of 6084
Bought back into CNK today. I'll see what happens this coming winter.

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To: richardred who wrote (5380)7/19/2019 10:04:39 AM
From: richardred
   of 6084
HBIO-Speculation- I have even more company now

Engine Capital Shows 8.5% Stake in Harvard Bioscience (HBIO), Urges Board to Consider Actions to Unlock Stockholder Value July 18, 2019 5:43 PM EDT In a 13D filing on Harvard Bioscience, Inc. (NASDAQ: HBIO), hedge fund Engine Capital disclosed a 8.5%, or 3,209,490 share ...

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From: richardred7/19/2019 10:53:42 AM
   of 6084
Gannett’s stock soars after WSJ report a buyout by GateHouse is near

Posted by: Market Watch in Market News 15 mins ago

Shares of Gannett Co. Inc. soared 21% in morning trading Friday, after The Wall Street Journal reported that the publisher of the USA Today newspaper was nearing a deal to be acquired by GateHouse Media. The WSJ report, out late Thursday, said the companies were discussing a cash-and-stock deal, which would join the U.S.’s two largest newspaper groups by circulation. On May 30, the WSJ had reported that Gannett and GateHouse were in merger talks. And in January, the WSJ reported Gannett was approached by hedge-fund backed MNG Enterprises Inc., better known as Digital First Media. Gannett’s stock has lost 5.7% over the past 12 months, while the S&P 500 has advanced 7.1%.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit for more information on this news.

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To: richardred who wrote (5382)7/19/2019 11:24:32 AM
From: richardred
   of 6084
HBIO- Speculation-IMO this recent activism made sense. Especially when the previous board already re-structured the company to prove the company was worth more than a 5 dollar 2007 Skystone Advisors LLC PE bid . What does the new board do, re-structure again? IMO Many divisions HBIO has can be broken up and sold if PE is bold enough to follow through? HBIO division workers would be better off in the hands of larger company with greater resources and complimentary products lines.

To: richardred who wrote (4332)1/17/2017 12:23:54 PM
From: richardred Read Replies (1) of 5383
Added to HBIO today. Hedge funds have a sizable interest. The company has been unsuccessful in bringing about a higher stock currently, than a previous PE bid. URL below is why it's in 2017 Top Ten SITT list. IMO the company is more undervalued now than then. The company even trades at a greater discount from the stingy TO bid that was made in 2007. Reminds me of an old successful TO favorite NBSC . Eppendorf To Acquire New Brunswick Scientific For $110Mln [NBSC]. They say it's rare for lightning to strike twice in the same place. However IMO HBIO is holding a ROD.


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To: richardred who wrote (5282)7/20/2019 9:33:32 PM
From: richardred
   of 6084
Is this a real proposal? I have my doubts. Would the board really be receptive to a 40 dollar in cash offer this time?. Especially without a strategic alternatives review search first. The big discount from TO price shows how confident Wall Street is of this purposed deal closing.

Red Robin investor resubmits its purchase offer—this time, without rancor Vintage Capital noted in its nonbinding bid that it is meeting with Red Robin’s leaders and hopes to keep the conversation “constructive.” By Peter Romeo on Jul. 18, 2019Waving an olive branch this time, activist investor Vintage Capital has resubmitted its offer to buy Red Robin Gourmet Burgers for $40 per share in cash for the 88% of the company it doesn’t already own.

Red Robin said in a statement that it would consider what it called a "proposal."

In a letter sent to Red Robin Chairman and acting CEO Pattye Moore, Vintage Managing Partner Brian Kahn sounded far friendlier than he had in previous communications, where he’d bashed Moore and her team for their handling of such matters as finding a new CEO. “We are pleased we have begun a constructive dialogue,” wrote Kahn, as indicated in a copy filed with the Securities and Exchange Commission. “We hope that this dialogue continues.”

Kahn proposed that Vintage form a new entity that would then merge with Red Robin. In a marked change in tone from past letters, he stated, “We believe the company is well-positioned for future growth, and we believe that many members of the company’s existing management are critical partners in the future success of the business.”

Vintage would meet with each retained senior member of the senior team to discuss “future roles and responsibilities,” Kahn wrote.

In Vintage’s prior letter, the company urged Moore and her team to either accept the $40-a-share offer or face a challenge by the investment firm for control of four of Red Robin’s nine board seats.

The communication noted that the offer is nonbinding. But it also pointed out that considerable due diligence has already been completed. The rest of the pre-sale work could be wrapped up in four weeks, and Vintage expects nothing out of the ordinary in pursuing the deal, Kahn said.

The $40-per-share offer exceeds the price of Red Robin’s stock on the day Vintage first offered that amount by 57%. The offer would value Red Robin, the franchisor and operator of about 562 full-service restaurants, at about $519 million.

Red Robin acknowledged receipt of the offer. "Consistent with its fiduciary duties and in consultation with its independent legal and financial advisors, the Red Robin board will carefully review and consider the proposal," read a statement from the company.

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From: richardred7/20/2019 9:41:37 PM
   of 6084

Performance Food Group (PFG) on Monday said it acquired fellow distributor Reinhart Foodservice in a $2 billion deal that promises to make PFG one of the largest national distributors in the United States.

The deal combines the country’s third- and fifth-largest foodservice distributors. PFG is No. 3 behind Sysco and US Foods, according to data from Restaurant Business sister company Technomic.

Reinhart is No. 5, and the second-largest privately-held distributor in the country. The distributor generates more than $6 billion in net sales, which would give Richmond, Va.-based PFG about $30 billion in net sales, the company said.

“The addition of Reinhart and its complementary strengths will expand Performance Foodservice’s broadline presence, improve our network efficiency and help us achieve our long-term goals,” PFG CEO George Holm said in a conference call Monday discussing the deal, according to a transcript from the financial services site Sentieo.

He said the deal “provides us with greater overall scale, a diverse but similar customer base, including a solid base of independent customers with little overlap.”

Reinhart was established in 1972 and has been owned by Reyes Holdings since 2005, a period in which the distributor grew to $6 billion in sales from $1.6 billion. Holm said that PFG and Reyes have been talking about a transaction “for many years now.”

“Now is the right time for both parties,” Holm said.

Reinhart has 26 distribution centers and 42,500 customers and employs 5,600 people. Its biggest chain customers include Burger King, Subway, and Five Guys. Holm said that PFG also does business with Burger King and Subway in some markets.

The deal is subject to regulatory approvals. PFG said it expects to see about $50 million in “cost synergies” by the third year following completion of the merger. Most of those will come in operations, procurement and logistics.

The agreement also promises to solidify PFG’s status as a major, national distributor and would put it within arm’s reach of US Foods, the second-largest distributor in the U.S., according to the Technomic Power 50 report.

“This really closes the gap between them and the current No. 2 US Foods,” said David Henkes, senior principal with Technomic.

At least some of the reasoning behind the deal centers on independent restaurants. Distributors have focused more attention on this group, which is growing and potentially more lucrative. Reinhart is no exception, but Holm believes that PFG will be able to help the distributor more effectively tap into this group of customers.

“They appropriately have spent a good bit of time redoing their warehouse network, reworking their customer base and positioning themselves for better independent growth,” Holm said. “But it is still a company that continued through that period of time to show, although very modest, independent growth. And we feel that we’ve got some sales processes that can help with that independent growth.”

Holm said the company doesn’t add a “significant amount of geography” with the acquisition, though it has no plans to reduce the number of distribution centers “at this point.” But he said the deal gets PFG “closer to the customer” with better delivery service.

“You’re not running your fleet as many miles,” he said. “Probably not running your salespeople as many miles either. We’ve always found those to be good things in the business.”

Henkes said PFG has made numerous strategic acquisitions recently, including one in which it acquired c-store distributor Eby Brown.

But deals between the largest distributors are rare and, Henkes said, will be increasingly so as the biggest players grow larger.

“This type of acquisition, one that involves two of the top 10 distributors in the industry, is going to be more rare as these distributors become huge national players that are competing coast to coast.”

UPDATE: This story has been updated to include deal analysis.

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From: richardred7/20/2019 9:49:52 PM
   of 6084

Illinois Tool Works is going shopping again.

The manufacturing conglomerate, once an enthusiastic buyer that made 600 acquisitions over 25 years, paused seven years ago to focus on profitability and improving internally generated revenue growth. While ITW's operating profit margin climbed to 24.3 percent during that time, "organic growth" lagged.

The company raised its target for the operating margin in December, aiming for 28 percent by 2023. That's hard to do, though, without the higher marginal returns that come from increased revenue.

CEO Scott Santi's answer is a return to dealmaking. He's looking for buyout targets and planning to sell off seven slower-growing businesses with $1 billion in aggregate revenue by the end of 2020. (The company hasn't specified which ones.) Glenview-based ITW, which makes products ranging from ovens to auto parts to adhesives, says it will consider only acquisitions that enhance the company's organic growth potential. The stock has risen 16 percent since the start of the year, to $146.87 on July 11, while an index of industrial stocks rose 22 percent.

ITW will likely buy two or three businesses a year with about $150 million in revenue, Robert W. Baird analyst Mig Dobre wrote in a June 19 note, citing conversations with company executives. The company will consider acquisitions in any of its business lines, except automotive, where organic revenue fell 6 percent in the first quarter. That opens the door to dealmaking in six other business segments: test and measurement/electronics; food equipment; polymers and fluids; welding; construction products; and specialty products. Deals could also provide entry into new markets, Dobre wrote, like health care, industrial printers and aircraft support products.

"There's no question in my mind that acquisitions remain a core component of our long-term growth potential," Santi said May 21 at an industry conference. "We can add a nice additional 1 percent to 2 percent to our overall growth rate over time with some really solid, right-in-our-wheelhouse acquisitions."

Company executives previously thought ITW "didn't need acquisitions to meet its long-term performance goals," Bloomberg Intelligence analyst Karen Ubelhart writes in a note. "Disappointing progress on growth may have changed this perspective."

ITW's revenue rose 3.2 percent last year to $14.8 billion, with the largest business, automotive, accounting for less than a quarter of sales. Operating margin in the automotive business has lagged the other segments, at 23 percent, and Ubelhart writes that the unit's first-quarter revenue decline was "worse than expected."

The decentralized company has 87 divisions, down from about 800 seven years ago as part of the strategy shift to improve margins and boost organic growth. It also has been pruning product lines and saved $350 million in procurement costs since 2013.

The operating margin went from 15.9 percent in 2012 to 24.3 percent last year, eclipsing an earlier goal of 20 percent. Now it is shooting for 28 percent, well above the midteens margins many industrial manufacturers post.

The company said in 2012 that it planned to grow organic revenue 2 percentage points faster than overall industrial expansion. But ITW's annual organic growth started at 0.6 percent, shrank 0.4 percent, then rebounded to 2.2 percent between 2012 and 2018, trailing global GDP growth of 2.5 to 3 percent during the same period.


Chief Financial Officer Michael Larsen said on an April 25 earnings call that because of a slow start to the year, the company was revising its organic growth guidance for 2019 to a range of 0.5 to 2.5 percent, down from 1 to 3 percent. Still, Santi said at the conference that ITW plans to add another 1 or 2 percentage points of organic growth by 2023 to "finish the job" and bring the growth rate to 3 to 5 percent annually.

That won't be easy. In 2018, even though 44 of the company's divisions grew 7.6 percent organically, 36 divisions saw revenue decline 3 percent while other industrial companies grew. That's "surprising and disappointing," Ubelhart writes, and "proving Illinois Tool can get a significant part of its portfolio on an accelerated growth path will be a challenge over the next few years."

To make those 36 divisions grow faster, the company is giving them a refresher course on its "80/20" management process, derived from the Pareto principle, where it focuses on the 20 percent of customers and products that generate 80 percent of the revenue.

"The byproduct of 50 or 60 acquisitions a year is the fact that we didn't really integrate any of them," Santi said. "We gave them six months of training and then onto the next 50 or 60, when 80/20 takes three to five years to really be good at."

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