Cypress Semiconductor
OK, if that didn't sound like a drastic move, you should know that a good deal of the company's $1.9 billion trailing revenue came from its 49% ownership of solar power specialist SunPower
Cypress shareholders of record at the close of trading Sept. 17 will be entitled to 42 million Class B shares in SunPower, and the actual distribution of shares will be made after Sept. 29. Cypress will liquidate its entire stake in the solar power outfit.
This spin-out basically forces Cypress to focus on its core semiconductor chip business, so it'll be easier to evaluate that company on its own merits now. I'm surprised to see the shares becoming sort of a fat dividend rather than being sold off to another corporation or on the open market, returning a big stack of cash to Cypress itself. But maybe the two companies' biggest institutional owners had a say in the matter.
Most of these vote-laden shares will go to institutional investors, as 93% of all Cypress stock belongs to various financial institutions. Janus Capital Group
The eight-votes-per-share B stock is getting a separate Nasdaq listing, and in the future you need to decide between buying SPWRA Class A shares or the fresh SPWRB cache. You've seen this before in companies like Berkshire Hathaway
Management estimates that its shareholders are getting about $3.6 billion of value handed down to them, putting the expected Class B share price at $86 or so. That puts a price premium on those extra votes. Mr. Market will undoubtedly adjust that ratio to his liking in due time.
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