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Atlas Spin-Off Analysis: A Value Lost In The Shuffle

On October 13th, it was announced that Atlas Pipeline (APL) is being bought by Targa Resources (TRGP). As part of that agreement, Atlas Energy's (ATLS) ownership stake in APL will also be acquired. Note that not all of Atlas Energy is being acquired. As part of that transaction agreement, Atlas is spinning out their non-Atlas Pipeline-related investments so that all of ATLS can then be bought. This transaction is quite complicated as you can see and the spin-off, or 'stub', that is left over has been neglected by the market and can now be purchased well below liquidation value. The sharp fall in oil and gas stocks has caused people to overlook this opportunity.

Leon Cooperman of Omega Advisors is one of the company's largest shareholders and has been multiplying his stake in the sell-off over the past month or two. He has been a long-time holder of the stock… Read More …