RE:RE:Market MoversKarl63 wrote: Can't say I understand the company motivation in doing this, and what it is actually that they're doing. I take it this is related to the spike a couple of months ago when the price went to $79 for about a minute? There wasn't much of a reaction in the markets today - maybe not enough time to digest the news? Is it a positive move for the shareholders? Can somebody interpret? Thanks
SOTP or Sum of The Parts valuation is what the analysts base BAM on. Other asset managers do not have such a large stake in their holdings and their asset management income is valued more.
Market has been selling off, the fact that it didnt go up could be alluded to the rumour that this was going to occur. The SOTP may also be impacted as people could be valuing the renewables and real estate less than previously and an overall wide valuation multiple drop market wide. Maybe people were expecting a larger amount like 50-75% split off (rest BAM + partners keep to maintain control).
I originally bought in August of 2020 at around $43 (unfortunately didnt buy more and other financials) and sold at around $77 on multiples. The market does not like the real estate side to BAM from BPY and would have prefered more be sold or transfered to funds. Earnings may also have been a minor miss.
Can't predict what will happen if a spin-off does indeed occur or does well but on assets BAM spunoff and had operations such as BEP, BIP, BPY, TSU did well or got bought back by BAM.