Farallon Capital Discloses KLX Position (Spin-Off From B/E Aerospace) ~ market folly

Tuesday, January 27, 2015

Farallon Capital Discloses KLX Position (Spin-Off From B/E Aerospace)

Andrew Spokes' hedge fund firm Farallon Capital has filed a 13G with the SEC regarding shares of KLX Inc (KLXI).  Per the filing, Farallon now owns 7% of the company with 3,675,000 shares.

This is a newly disclosed equity position for the firm and the filing was made due to activity on January 16th.  KLX was recently spun-off from B/E Aerospace (BEAV) and BEAV shareholders received 1 KLXI share for every 2 BEAV shares held.

Given that Farallon didn't own BEAV as of the end of the third quarter, they either bought BEAV in the fourth quarter and then received KLXI shares in the spin-off, or they just purchased KLXI straight up once it was separated.

Per Google Finance, KLX is "the distributor and service provider of aerospace fasteners and consumables. The Company offers ranges of aerospace hardware and consumables, and inventory management services across the world. The Company operates in two segments: Aerospace Solutions Group (ASG) segment and Energy Services Group (ESG) segment. Its customers include oil and gas companies that are engaged in the exploration, and production and development of oil and gas properties. The Company through its network and information technology systems offer services to commercial airliners, business jet and defense original equipment manufacturer (OEMs) and its subcontractors, airlines, and maintenance, repair and overhaul (MRO) operators. The Company provides access to over one million stock keeping unit (SKUs). Its systems support both internal distribution processes, along with customer services, including just-in-time deliveries and kitting solutions."

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