Corporate spin-offs are back and busting out all over. A generally strengthening stock market is fueling what could be the biggest uptick in divestitures since the high-tech boom of the late 1990s.
From January to mid-March of this year, 10 spin-offs were announced, compared to 15 for all of 2004. A spin-off involves a company completely ending its control of a division by giving its shareholders stock in the new firm.
Aside from certain pregnant women, not many people would pair pickles and coffee creamer. Dean Foods (DF), though, has packaged those two products into a subsidiary soon to be spun off to shareholders. An early look at the business makes the deal look pretty appetizing for investors.
Dean, the largest dairy producer and owner of the Silk (soy milk) and Horizon Organic brands, will be distributing virtually all shares in TreeHouse Foods to Dean shareholders late this month.
