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Clearbridge Advisors Managing Director Michael Clarfeld on how investors can profit from acquisitions by large-cap companies.
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-- you wanna pick names that are acting like pac man eating things up right Michael Clarke -- them clear rich advisors is that really.
The way to go acquisition Alley finding what -- -- some of the -- buying opportunities in the market lets get to these names William UP SUPS.
Went to make a big acquisition of T and T have little bit of the stubble there but nonetheless you say that's the company wanna.
Yeah I think you know it's an interesting time that we like acquisitions we don't always like acquisitions I think it.
A lot of investors know that frequently went management used during acquisitions.
They're doing it to big get bigger to build an empire -- it's not always the best he's capital today we think that's different we think because the combination of low valuations on the target companies.
Stable would buy them at attractive prices.
And then these large companies are able finance -- in the debt markets at very low rates of interest so there will make you very accretive acquisitions so.
We don't wanna see we always like acquisitions but we think right now is a very opportune time for large company to do -- all cash deals FO UPS being one -- -- UPS and you've got a dividend there went to fetch quite not forget if UPS almost 3% in what we like about UPS -- reasonable benefits are sure of what we're like -- -- now chart.
Large cap blue -- American companies -- really we're we're finding the best opportunities.
What we like about the acquisition is they're -- teen -- Europe.
TT is very complimentary EU the European Union says it just needs more time to look at the deal and Parse it yeah exactly -- local market -- It does seem that things take longer than we like -- sick so we think it's a great deal for them because there's a tremendous amount of synergies -- -- think about it UPS has network over there they have drivers there -- -- TT has almost a duplicate network and what happens in this type of merger is.
You're able to basically eliminate one of those networks so you're -- take a tremendous amount of cost out and put strict push greater volumes.
Through one network which ends up being that really driving increasing probability -- where -- Europe has I don't know -- and I never understood it cannot -- that's love.
-- If he has to -- -- united technology yeah she -- that big conglomerate.
Otis elevator Sikorsky helicopters you name it Goodrich their -- that's right so we like to -- deal.
Again very similar UPS this is a record deal would doing -- in -- stepping out getting into new business line.
This is aerospace this -- quarter than their Pratt Whitney -- Hamilton Sundstrand.
We like the aerospace market right now optically the OEM side of -- because we think.
There's a lot of uncertainty in the economy and there's not a lot of plates of -- like conviction.
But the -- watch these new planes like the 787 -- many years -- -- great visibility.
So we like that they're getting bigger commercial aerospace and again this is -- them you TX has a great track -- being good operators will be able take cost down improve margins and returns.
And their financing an incredibly attractive levels they raised almost ten billion in debt back in May it's the single biggest bond offering we've seen in the debt markets in three years and they -- -- it's very attractive rates.
Your last pick is in bad -- they of course just finally popped up last piece of corona they didn't aren't exactly and that of course is -- Pretty much consumer staple it comes to beer.
Yeah we get -- and it's not just 'cause we like -- that we like this I thought so Avian that is fantastic company they're big businesses would be Basel Budweiser in the United States in the name big Brazilian burn operation.
And just like the other two we talked about they're buying and something very core the 49% of group -- Manila -- they don't -- They're doing it all cash and the financing and an incredibly attractive rates.
So again this is a great synergy opportunity BAB InBev management team has shown over the years.
It's a tremendous -- taking costs out of acquisitions.
And improving margins -- returns group -- medallist already well run but they'll do anything better job.
Well here you go and that's a stock that's up at least for InBev up 39% year over here it's been presented a little bit of dividend one point 7% of sir Michael good to see everything flawless.
Off go off and make money -- putting up its credit does have a -- his father but -- average advisors --
