The company is clearly an interesting asset in a growing industry, but the most important questions concerning prices and adjustment. Current valuations appear rich from a company whose revenues have stagnated in recent years. In addition, the independent research company and analysis may prevent potential buyers because of possible conflicts of interest.
Sara Lee Corp (SLE)
March 31, 2011 Position: 27,404,523 shares.
The food conglomerate is trading near its highest in 52 weeks after dipping slightly in the weeks following the announcement of the impending reorganization of the company. Spin-offs are a well known method of unlocking value, largely because it makes business lines easier to acquire. After the spin-off, current shareholders will own shares of SLE two separate companies, an international tea and coffee trade and a North American food company with brands such as Hillshire Farm and Jimmy Dean.