http://hedge.lu/index.php?action=history&feed=atom&title=The_Economic_rationale_behind_spinoffs 2026-09-22T19:33:38Z Revision history for this page on the wiki MediaWiki 1.28.2 http://hedge.lu/index.php?title=The_Economic_rationale_behind_spinoffs&diff=28&oldid=prev 2017-06-22T13:31:21Z

<p></p> <table class="diff diff-contentalign-left" data-mw="interface"> <col class='diff-marker' /> <col class='diff-content' /> <col class='diff-marker' /> <col class='diff-content' /> <tr style='vertical-align: top;' lang='en-GB'> <td colspan='2' style="background-color: white; color:black; text-align: center;">← Older revision</td> <td colspan='2' style="background-color: white; color:black; text-align: center;">Revision as of 13:31, 22 June 2017</td> </tr><tr><td colspan="2" class="diff-lineno" id="mw-diff-left-l10" >Line 10:</td> <td colspan="2" class="diff-lineno">Line 10:</td></tr> <tr><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"></td><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"></td></tr> <tr><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>== Take-aways ==</div></td><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>== Take-aways ==</div></td></tr> <tr><td class='diff-marker'>−</td><td style="color:black; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #ffe49c; vertical-align: top; white-space: pre-wrap;"><div>* The <del class="diffchange diffchange-inline">covenants and contractual details of a bond are paramount and </del>can <del class="diffchange diffchange-inline">make the difference between profit and loss, sometimes spectacularly</del>.</div></td><td class='diff-marker'>+</td><td style="color:black; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #a3d3ff; vertical-align: top; white-space: pre-wrap;"><div>* <ins class="diffchange diffchange-inline">Spinoff aim at making an entity more valuable by being splitting in two. </ins>The <ins class="diffchange diffchange-inline">discrepancy </ins>can <ins class="diffchange diffchange-inline">come from taxes</ins>.</div></td></tr> <tr><td class='diff-marker'>−</td><td style="color:black; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #ffe49c; vertical-align: top; white-space: pre-wrap;"><div>* <del class="diffchange diffchange-inline">The reach of the US is formidable, thanks to the implication of US intermediaries in most international transactions</del>.</div></td><td class='diff-marker'>+</td><td style="color:black; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #a3d3ff; vertical-align: top; white-space: pre-wrap;"><div>* <ins class="diffchange diffchange-inline">Activists target firms with inconsistent structures or large holdings/long term investments/cash</ins>.</div></td></tr> <tr><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"></td><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"></td></tr> <tr><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>== References ==</div></td><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>== References ==</div></td></tr> <tr><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>&lt;references /&gt;</div></td><td class='diff-marker'>&#160;</td><td style="background-color: #f9f9f9; color: #333333; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #e6e6e6; vertical-align: top; white-space: pre-wrap;"><div>&lt;references /&gt;</div></td></tr> </table>

Hector http://hedge.lu/index.php?title=The_Economic_rationale_behind_spinoffs&diff=17&oldid=prev 2017-06-22T00:15:36Z

<p>Created page with &quot;== Firms Involved == * Alibaba * Yahoo == Year of the event == 1998-2016 == Description of the case == Long ago, Yahoo bought a 40% participation in a tiny Chinese firm for...&quot;</p> <p><b>New page</b></p><div>== Firms Involved ==<br /> * Alibaba<br /> * Yahoo<br /> <br /> == Year of the event ==<br /> 1998-2016<br /> <br /> == Description of the case ==<br /> Long ago, Yahoo bought a 40% participation in a tiny Chinese firm for a modest amount. In 2015, this participation had grown to become larger than the value of Yahoo itself, though Yahoo owned ''only'' 20% of Alibaba by then. In fact, in 2015, Yahoo’s core business was worth around $5bn, while its participation in Alibaba was worth circa $40bn. Under the pressure of shareholder activist Starboard Value&lt;ref&gt;http://businesscycles.eu/tech/cowcot-entreprises-yahoo-contre-les-activistes/ Business Cycles (FR), ''Yahoo contre les activistes''&lt;/ref&gt;, Yahoo planned to spin off its participation in Alibaba in a new entity, and give the shares to its shareholders. That was a major issue, as the DOJ was looking forward to taxing heavily this transaction&lt;ref&gt;[https://www.bloomberg.com/view/articles/2015-01-28/yahoo-would-rather-not-pay-taxes-on-its-alibaba-shares Bloomberg, ''Yahoo Would Rather Not Pay Taxes on Its Alibaba Shares'']&lt;/ref&gt;, which would result in the loss of $16bn (40%). In 2016, Yahoo found another suitable solution: instead of making a spin-off of Alibaba’s shares, Yahoo would sell its core business, and the historic Yahoo would become a shell holding Alibaba Stock as well as various other participations and licenses. The reborn holding entity was named Altaba. The transaction was completed as planned, with Verizon acquiring Yahoo&lt;ref&gt;[https://techcrunch.com/2016/07/25/verizon-buys-yahoo-for-4-83-billion/ Techcrunch, ''Verizon buys Yahoo for $4.83 billion'']&lt;/ref&gt; in June 2017. Yahoo, having cleared the shadow of the potential tax payment, appreciated sharply.<br /> <br /> == Take-aways ==<br /> * The covenants and contractual details of a bond are paramount and can make the difference between profit and loss, sometimes spectacularly.<br /> * The reach of the US is formidable, thanks to the implication of US intermediaries in most international transactions.<br /> <br /> == References ==<br /> &lt;references /&gt;</div>

Hector