Wednesday, November 15, 2006


The WSJ’s „Heard on the Street” column reports that private-equity firms are circling ServiceMaster (SVM). Although ServiceMaster doesn't have a process for fielding buyout inquiries, some on Wall St. are openly talking about ServiceMaster as being "in play." Buyout firms' interest, coupled with some behind-the-scenes shareholder unrest, could push the co to make some major changes in the months ahead. At least some pple following ServiceMaster suggest that a mgmt-led buyout of the co is another possibility. Any buyout offers, or other corporate changes, could push up the stock price, which has been languishing lately.

According to the Barron’s Online, Tejon Ranc (TRC) shares look like a good bet, despite doubling in price over the past 5 years. Backers of the co believe that an emerging industrial center and residential projects on the site should attract burgeoning populations from LA and surrounding areas. After years of planning and discussions with various interest groups, Tejon is slowly monetizing its real-estate assets by forming partnerships to set up a foreign trade zone to attract clients to its 1,500-acre industrial park and with various home builders to develop residential communities called Centennial and Tejon Mountain Village. However, the most attractive part of Tejon is that the book value of the ranch is a mere $7.9m, or $29 per acre, notes Harris Hall, director of research at Singular Research. That is, the land is cheap and its value will multiply once it is sold off or leased through the development projects. Tejon's three development projects make up less than 10% of the land, but "each individually represents billions and billions of dollars worth of real estate for the foreseeable future," says Robert Stine, Tejon's CEO for the past decade.

“Inside Scoop” section reports that Fidelity Investments has sold off nearly 16m Yahoo (YHOO) shares since Sept. 30, when the co owned 38.9m shares. "You've got basically what is the most aggressive selling [of Yahoo stock] Fidelity has ever done in one period of time," Ben Silverman, director of research at, says.

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