While the current deal landscape on Wall Street remains low on M&A, initial public offerings (IPOs), and other transactions, corporate spinoffs are chugging along. With companies under pressure to focus on their core business, a mini-flurry of spinoff stock debuts and new proposals have emerged in the past week.
“Spinoffs today are just more visible, given the paucity of IPOs,” said Jay Ritter, a finance professor at University of Florida who tracks the new issues market. In good times, Wall Street is hungry for any new stock and spinoffs are cheered as a way to unlock the value hidden in a neglected part of a conglomerate. Right now, however, the uncertainty about value, combined with market volatility around the debt ceiling, a spike in bond prices and turmoil in Congress, has translated to some bruising losses of late in freshly spun off stocks.
Veralto Corp.
VLTO,
+1.96%,
an environmental solutions business that was spun out of Danaher Corp.
DHR,
-0.16%,
has fallen 12% in the past five days. It officially joined the S&P 500
SPX
on Monday.
Vestis Corp.
VSTS,
-4.28%,
which star …
Article Attribution | Read More at Article Source