News & Press
US Vivendi Investors Were Shortchanged, But ABBA Mania & George Lucas Are The Key To Great Growth For UMG
Pioneering Universal Music Group will have exponential growth with a stellar team truly embracing the digital universe and this will eventually result in great returns for US investors, according to The Edge.
In February, Vivendi SE’s (VIV FP) management board asked shareholders to approve a 60 percent distribution of Universal Music Group BV’s (UMG NA) share capital by the end of 2021 (completed September 21). Shareholders were offered a distribution ratio of one share of UMG for every one share held of VIV FP, and shareholders enthusiastically supported the strategy, but there was a catch for American investors…
Deal makers have targeted the wine industry, as investors bet on rising prices for winery acreage despite a Covid-19 hit to demand for the beverage. Deals by private-equity funds to invest in wineries, vineyards and distributors have risen 75% in 2021 so far, compared with last year, according to Refinitiv. There has also been a jump in mergers and acquisitions, with companies spending $8.1 billion this year to snap up wine-related firms, compared with $1.8 billion last year, Pitchbook data showed.
A SPAC is a shell company that lists on an exchange and then seeks to acquire a private company to take it public. Many have bought software and clean-tech industries, but are now looking further afield. “With more than 430 SPACs in 2021 looking for acquisition targets, there are not enough unicorns ready to go public,” said Jim Osman, portfolio lead at research firm Edge Group. As a result, “SPACs are looking for alternative companies.”
Finding an edge in financial markets is hard. We explore the Special Situations opportunity with our guest expert. How does it work? Why is it an opportunity? Can it work for Axe Capital?
Jim Osman (Founder & CEO of The Edge) provides insight into the Special Situations investing space and Goerge Aliferis puts this in the context of Showtime’s Billions‘ Axe Capital. See the video below.
This is the inaugural episode of The Fintech Files podcast v2.0. In this episode, I’m [George Aliferis] speaking with Jim Osman the founder of The Edge Consulting Group, a research boutique specializing in sourcing special situation investments, such as Spinoffs and activist ideas. In this new edition of the podcast, we will separate the conversation into two parts. First, we are going to talk about careers. Then, we will break down a specific financial or fintech topic. In this episode, it will be Special Situations investing.
The first half of the full podcast is available on video at this link.
The Stock Market Is At Record Highs, But Corporate Debt Is Ballooning. Here Is One Stock That Should Benefit.
Credit agencies may be one of the big winners of the post-pandemic build back, as they ride the waves of economic instability and decide which consumers and businesses are worthy of credit lines and extra lending. They wield very real power. Deloitte reported this month that companies needed to borrow to invest in home working and social distancing and, for some luckier businesses, needing to borrow more to expand as the pandemic provided them with fruitful opportunities. They still must pay this money down, of course.
The power of the credit agency has therefore grown to an all-time high, and The Edge thinks stocks in this field are worth watching. One credit agency which has caught The Edge’s attention is Dun & Bradstreet Holdings, Inc. (DNB), a company that offers information on commercial credit as well as reports on businesses and has the information on millions of companies. The stock has drifted, but now may be the time for investors to look at co-investing with the management.
Emerging markets have so far been on the fringes of a fundraising boom using so-called SPACs or special-purpose acquisition companies, which could potentially unlock a vital new source of cash for entrepreneurs in developing regions. But the take-off of SPAC fundraisings in these markets hinges in part on the success of a few recently-delayed landmark deals, reflecting wider global investor caution about this funding tool. SPACs allow investors to list a shell company on public markets before they have identified a business to buy, which provides a speedier route to an initial public offering.
In excess of $115.6 billion has been raised via more than 400 SPACS or blank-check companies this year, mainly on Wall Street where SPACs make up two thirds of all Initial Public Offerings (IPOs), although activity has slowed as regulatory and valuation concerns have increased. In contrast, a total of $1.18 billion has been raised this year via six SPACs by emerging market issuers, including two apiece from Israel and China. This is just a fraction of the $96.3 billion raised via traditional IPOs from emerging markets, based on Refinitiv data.
“The explosion and subsequent quenching of SPAC enthusiasm in developed markets provides a potential lesson for emerging markets to learn from,” said Alex Korda, analyst at consultancy The Edge Group.
Jim Osman is neither a growth, nor a value investor. “I am a fundamental investor overall,” Osman said. “I invest in solid companies and particularly in company change.”
One key area of focus are special situations, where an investor will take a stake in a company based on a particular catalyst that carries with it the potential for a significant increase in future value. Such catalysts could include spinoffs, insider buying and management changes. It’s a strategy that works. More than 200 clients, who have a total of $400 billion under management, each pay a minimum of $1,000 a month for special situations research from Osman’s firm, The Edge Group.
When Insider spoke to Osman this time last year, in the midst of the pandemic, he was recommending investors to take advantage of a few emerging themes, with stock picks based off of technological advancements and a younger, more-insular consumer. Equity investors have seen huge returns, as the economy has broadly recovered and the US stock market has continually reaches new highs. Osman is now focused on how his clients can ringfence those profits.
Please join Gary Brode of Deep Knowledge Investing for a discussion with Jim Osman of The Edge regarding special situations investing. Jim will discuss how his firm identifies attractive special situation ideas as well as a couple of his favorite current ideas. Recommended viewing for anyone interested in catalyst-driven investing.
In 2021’s mid-year update, The MoneyShow has featured two of Jim Osman and The Edge’s top conviction ideas – Harley-Davidson, Inc. (HOG) and IAC/InterActiveCorp (IAC). See inside for more details.
Merck’s New Spinoff Organon Shows How Women’s Health Can Provide Fertile Ground For Investment. Here’s Why.
It may be 2021, but the issue of women’s health – especially reproductive rights, birth control and fertility issues – is one which still provokes heated debate and makes headlines around the world. Considering the global women’s health market is predicted to be worth $50 billion by 2025, it seems somewhat ironic that one of the more silent voices tends to be that of Big Pharma.
Heavy hitters are getting out of the game and moving away from investment in the sector, with multi-national pharmaceutical company Merck & Co., Inc. (MRK) Spinning off Organon & Co. (OGN) earlier this month. However, according to analysis from The Edge, it looks like OGN may be the big winner here.
Founded in the Netherlands in 1923, OGN became a world-leading pioneer in contraceptives, and while it’s going back to its roots post-Spin, it has clearly renewed its focus on medical breakthroughs and future-proofing its brand. Stepping into a space which is largely ignored and focusing on ground-breaking contraceptives could be the secret weapon in its armory.