A steal for Stellar?
Acquisitive industrial conglomerate Torre had, at the time of writing, fallen to levels around half of its 510c 12-month high in July 2015.
Torre has made some inspired acquisitions and accumulated a vibrant hub of diverse industrial operations. However, it’s a tough slog for any industrial company linked to the stagnant local economy, and lower profits at Torre are unavoidable.
But the downswing in sentiment for Torre does open a door for recently formed investment company Stellar Capital Partners (SCP), which already owns close to 35% of Torre, to make a move on its industrial associate. An offer by SCP to Torre minorities — especially a deal that includes a scrip option — is likely to be welcomed, as shareholders might prefer to switch from a pure industrial play to a more diversified counter with a substantial war chest.
Of course, pricing the buyout pitch is not going to be easy — not only because Torre’s prospects look a little rusty but also because SCP, which is in the throes of wooing asset manager Prescient, is in a phase of rapid transformation.