This spinoff has big takeover appeal

Article Excerpt

Lamb Weston is the latest in a long line of spinoff successes that have produced strong gains for their investors and their parent companies. Since Conagra spun off this leading frozen-potato operation in 2016, the stock has jumped over 50%. Shares in its parent company have also risen. We feel both companies have more growth ahead. Moreover, Lamb Weston is well-positioned to attract takeover interest, which could significantly boost the returns for its shareholders. LAMB WESTON HOLDINGS INC. $47 (New York symbol LW, Shares outstanding: 146.2 million; Market cap: $6.9 billion; Takeover Target Rating: Highest; Dividend yield: 1.6%; TSINetwork Rating: Average; www.lambweston.com) was a wholly owned subsidiary of Conagra Brands (see next page) until November 9, 2016. That’s when Conagra set up Lamb Weston as a separate company. Conagra investors received one Lamb Weston share for every three shares they held. Lamb Weston began operating in 1950 when founder F. Gilbert Lamb, an established vegetable producer, purchased a co-op plant in Weston, Oregon…