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Unfortunately, One Can’t Borrow A When Issued

Summing The Parts, With Actual Parts:  MFS-W, the when issued trading for Manitowoc Foodservice, began trading this week and closed today at 12.92 on 950,000 shares traded – the first day of decent volume.  Since MFS will have about $1.4 billion in net debt and about 137 million shares, the MFS enterprise value pencils out to just shy of $3.2 billion.  The combined current MTW EV comes out to $3.475 billion, of which about $210 million is the net debt of the remaining Cranes business.  That leaves the lightly levered remaining Crane business, with nearly $2 billion in sales and potential Chinese suitors, with just over $100 million in equity value.  At 2014 Crane segment profitability that equity value equates to a P/E of roughly 2 by our estimates. 

MTW | MFS-W Trading, Implied Crane Value Quite Small - MTW MFS 2 23