Is Ralcorp (RAH) Back In-Play After Activist Gets Involved?
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Traders have a keen eye on Ralcorp Holdings Inc. (NYSE: RAH) today after an activist investor entered the scene.
Today, Corvex Management LP disclosed a 5.13%, or 2,835,296 share, stake in the company in a 13D filing. This is up 367.00% from the 607,124 shares held at the end of the latest quarter ending June 30, 2012. Corvex said the company should pursue three alternatives to enhance stockholder value: 1) a sale of the company, 2) a merger with another food company to take advantage of economies of scale and cost synergies or 3) a "self-help" strategy with new investor board representation and a renewed focus on execution, accretive acquisitions and efficient capital allocation.
A sale of the company is not farfetched. In 2011, ConAgra Foods (NYSE: CAG) offered to acquire the company for up $94 per share in cash. They later dropped the bid after months of rejections from Ralcorp.
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Today, Corvex Management LP disclosed a 5.13%, or 2,835,296 share, stake in the company in a 13D filing. This is up 367.00% from the 607,124 shares held at the end of the latest quarter ending June 30, 2012. Corvex said the company should pursue three alternatives to enhance stockholder value: 1) a sale of the company, 2) a merger with another food company to take advantage of economies of scale and cost synergies or 3) a "self-help" strategy with new investor board representation and a renewed focus on execution, accretive acquisitions and efficient capital allocation.
A sale of the company is not farfetched. In 2011, ConAgra Foods (NYSE: CAG) offered to acquire the company for up $94 per share in cash. They later dropped the bid after months of rejections from Ralcorp.
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