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TheStreet Open House

When It's FMC, Breaking Up Isn't Hard to Do

NEW YORK (TheStreet) -- Sometimes you have to search to find rewarding investment themes. I found them in FMC Corp. (FMC).

It's a diversified chemical firm serving agricultural, industrial, environmental and consumer markets globally for more than a century with innovative solutions, applications and products. Its shares are up 3.7% for the year to date as of the Thursday close of $78.24.

FMC had annual sales of approximately $3.9 billion in 2013 and I expect that number to leap by more than 13% to $14.4 billion by the end of 2014. The company's market cap is about $10.4 billion and trades an average 1.1 million shares daily. It employs approximately 5,600 people throughout the world and operates its businesses in three segments: FMC Agricultural Solutions, FMC Health and Nutrition and FMC Minerals.

Those three segments are the big investment reward that awaits savvy investors. The company announced last month it plans to separate into two independent public companies: "New FMC," which will be comprised of FMC's Agricultural Solutions and Health and Nutrition segments and "FMC Minerals," which will be comprised of FMC's current Minerals segment.

The company expects the separation, which remains subject to final board approval and other customary conditions, will take the form of a tax-free distribution of shares to existing FMC shareholders. FMC expects to complete the separation in early 2015, with each company expected to be listed on the New York Stock Exchange.

Before the March 10 announcement, shares of FMC were on a downward-sloping course that hit a nadir of $67.31 on Feb 6. As the chart below illustrates, the news of the split culminated in a 25% rally to a zenith of $83.94. Since then shares have cooled to a more attractive level.


FMC Chart
FMC
data by YCharts

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