Value Don't Lie

Value Don't Lie

Share this post

Value Don't Lie
Value Don't Lie
Quick Value #254 - Microcap Spin at 3x EBITDA
Copy link
Facebook
Email
Notes
More

Quick Value #254 - Microcap Spin at 3x EBITDA

A misunderstood asset sitting within a larger and higher multiple business

Jan 27, 2025
∙ Paid
14

Share this post

Value Don't Lie
Value Don't Lie
Quick Value #254 - Microcap Spin at 3x EBITDA
Copy link
Facebook
Email
Notes
More
14
1
Share

Today’s idea:

This is an upcoming spin-off where RemainCo has negative implied value.

What’s the catch?

  • RemainCo is definitely an “ick” investment in an “ick” industry

  • It’s complex (prospectus is just shy of 1,000 pages)

  • It’s under the radar (no flashy capital markets day)

But at the same time this is one of the more interesting spins I’ve seen in a while…

  • Simple thesis — RemainCo was used as a revenue and cash stream for SpinCo

  • Large spin ratio — tiny stub position could lead to heavy selling

  • Small/microcap — post-split market cap likely $100-400m

This post is for paid subscribers

Already a paid subscriber? Sign in
© 2025 Value Don't Lie
Privacy ∙ Terms ∙ Collection notice
Start writingGet the app
Substack is the home for great culture

Share

Copy link
Facebook
Email
Notes
More