In a newly-amended filing with U.S. Securities and Exchange Commission, Steve Cohen’s Point72 Asset Management disclosed increasing its position in Olin Corporation (NYSE:OLN), as it is about to complete its merger with Dow Chemical Co (NYSE:DOW). The investor raised his position in Olin Corporation (NYSE:OLN) to over 4.94 million shares from 4.06 million shares held previously, according to the filing. Point72’s current stake is equal to 6.4% of Olin Corporation (NYSE:OLN)’s outstanding common stock.
Based in Connecticut, Point72 Asset Management is the legal successor of the hedge fund SAC Capital Advisors. It was launched in April 2014 with approximately $9 billion in initial capital, which represented Mr. Cohen’s personal wealth. SAC Capital was shut down in 2013 and paid a substantial fine to settle insider-trading charges. Point72 Asset Management, is prohibited from managing money for outside investors as part of the settlement with the Department of Justice. Point72 employs a long/short equity investing approach and makes significant quantitative and macro investments. According to the fund’s latest 13F filing with the SEC, Point72 manages an equity portfolio worth $14.67 billion as of March 31.
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Point72 stated in the filing that it acquired shares of Olin Corporation (NYSE:OLN) for investment purposes and it has no intentions to influence the control or management of the company.
Olin Corporation (NYSE:OLN) is a manufacturing company, with a market cap of $1.96-billion. It operates three business segments: Chlor Alkali Products, Chemical Distribution and Winchester. Last week, Olin Corporation (NYSE:OLN) reported that it received all the foreign regulatory approvals required to close its pending merger with Dow Chemical Co (NYSE:DOW). Under the agreement, Olin Corporation (NYSE:OLN) has agreed to buy certain chlor alkali and downstream derivatives businesses from Dow using a Reverse Morris Trust structure. As part of the deal, Dow will first transfer its U.S. chlor alkali and vinyl, global chlorinated organics, and global epoxy businesses to a subsidiary. Next, the company will distribute the stock of that subsidiary to its shareholders through a split-off or spin-off or a combination. Then, the subsidiary will immediately merge with Olin.
What will Dow’s shareholders get from this deal? You can read it on the next page.
Dow’s shareholders will receive approximately 80.6 million shares of Olin’s common stock, representing approximately 50.5% of the outstanding shares of Olin’s common stock, with the existing Olin shareholders owning the remaining approximately 49.5%. In addition to the Olin stock, Dow will receive about $2.0 billion of cash and cash equivalents, while Olin will assume about $800 million of pension and other liabilities. The deal is subject to approval by Olin shareholders and completion of customary closing conditions. The transaction is expected to be closed by the end of this year.
For the first quarter of 2015, Olin Corporation (NYSE:OLN)’s net income slipped to $13.1 million, or $0.17 per diluted share, versus $29.5 million, or $0.37 per diluted share, in the same period last year. The company reported a decrease in its quarterly sales to $518.0 million, versus $577.4 million in the same period last year. Shares of the company have increased by 10.16% year-to-date (YTD).
Other shareholders of Olin Corporation (NYSE:OLN) include Anand Parekh’s Alyeska Investment Group and Israel Englander’s Millennium Management, according to our record. Alyeska holds 636,895 shares, while Millennium owns 609,923 shares of the company as of the end of the first quarter.
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