Sears Hometown Spinoff|
Sears Holdings Corp (SHLD) on Monday filed an amended preliminary prospectus or
'red herring' with the Securities and Exchange Commission to move ahead with the
spinoff of its remaining Hometown and specific hardware stores through a rights
offering that will also include its outlets. The plan by Sears is to spin off a
publicly traded company that will control nearly 1,200 small but generally
profitable franchised stores that sell Sears products, as well as its stores
called Hometown. The Hometown stores are primarily independently owned, carry
Sears’s own products like Kenmore appliances, Craftsman tools and Diehard
batteries and, offer appliances and consumer electronics as well as, lawn and
garden equipment. For 2011, Hometown stores accounted for nearly $2.6 billion of
Sears’ $41 billion in revenue last year, but made up nearly 25% of its earnings
before interest, taxes, depreciation and amortization. On Thursday, Sears will
report Q2 results and expects the separation of the businesses to raise about
$400 million to $500 million for Sears Holdings plus, provide the company with
additional liquidity. Company executives have said that the spinoff will allow
Sears, which is trying to turn operations around, to focus on its core business.
The company expects to enter into an asset-based senior secure revolving credit
facility and expects to provide aggregate maximum borrowings of up to $250
million, in connection with the spinoff. Prior to the spinoff, Sears expects to
draw between $75 million and $100 million under the facility to pay a cash
dividend to Sears Holdings. ESL Investments, the hedge fund controlled by Sears
Chairman Edward Lampert that owns a majority stake in Sears, will have a
majority stake in the spinoff. The new company expects to trade on the Nasdaq
under the symbol (SHOS).
Chairman and Chief Executive Jason Jiang of Focus Media Holding Ltd. (FMCN) as
well as other investors, are offering to take the Shanghai-based advertising
company private in a $3.66 billion deal or $27 a share, that would remove it
from the skeptical eye of U.S. investors as well as, short-seller Muddy Waters
LLC. The move would make Focus Media the latest and largest Chinese company to
remove itself from the U.S. stock market. On news of the buyout offer, FMCN
shares were higher by 8% into late afternoon trading. In November, the firm has
been accused by Muddy Waters LLC of overstating the number of
liquid-crystal-display screens it uses to display ads in China by about 50% and
accused it of overpaying, writing down $1.1 billion out of $1.6 billion in
acquisitions since 2005 - claims that could not be confirmed. Muddy Waters has
made a name for itself questioning the accounting and business practices of a
number of U.S. listed - Chinese companies. Under mounting pressure in recent
years, auditors declined to sign off on the earnings of some of the Chinese
Crude-oil futures retreated Monday as September delivery (NMN:CLU2) shed 14
cents to end at $92.73 a barrel on the New York Mercantile Exchange. Natural-gas
futures led losses among energy futures, with the September contract (NMN:NGU12)
off 1.5% to $2.73 per million British thermal units.
Amidst restructuring of its domestic U.S. operation, on Monday, FedEx Corp.
(FDX) said it will offer voluntary buyouts to an unspecified number of staff as
the package shipper. With the focus on FedEx Express and Service units which
employs over 158,000 people, FedEx is still determining eligibility for the
planned buyouts. As customers shift from pricier overnight air delivery at the
domestic Express, volume has taken a substantial hit with the company parking
jets in the wake of a slowdown in business from Asia. With buyout offers due to
individuals by next May, FedEx said the cost of the staff cuts has yet to be
determined with cost spread out over several quarters in fiscal 2013 and 2014.
You can track
the call performance of our moderators from inside our live Trading Rooms
throughout the trading day by following us on
Twitter. Also join us on
trial to our Day Trading Rooms
for stocks, futures and forex. Professional Training
Programs available for stocks, futures and forex traders.
trading calls focus on NYSE, NASDAQ and AMEX. Futures
trading calls focus on YM, NQ and ES. Forex
based on New York trading session focus on GBPUSD, USDCAD, USDJPY, EURUSD,
GBPJPY, USDCHF, EURJPY, EURAUD, AUDJPY, CHFJPY, EURCAD, GBPCAD and AUDUSD.
Detailed historic performance available on our Market
Trading Lesson provides new trading subject every month.
Opt-in to our free Weekly MarketNews sent via email, first trading day of the week. Includes recap of
markets from previous week as well as active stocks plus, see what is ahead for
the upcoming trading week.
Free Chat Rooms - penny stocks, options, stocks, futures and forex! Chat
with other traders during off-peak market hours.
Aug 13, 2012