Starboard Value Goes Active On Brink’s Company (BCO) by Activist Stocks
Starboard Value now owns 8.2% of Brink’s Company. The fund hasn’t laid out any plans. The move puts Brink as the fund’s 9th largest holding on a pro forma basis.
It’s an international operator, with that part of the business driving the growth. North America is a weak spot. Since its 2008 spin-off of Brink’s Home Security Systems, the company-wide operating margin has been lackluster. The shift has to be toward higher margin businesses.
Maverick USA was down 3.3% for the second quarter, while Maverick Levered was down 2.1%. Maverick Long Enhanced was up 8%. Year to date, Maverick USA is up 31.8%, while Maverick Levered has gained 49.3%. Maverick Long Enhanced has returned 9.9% for the first six months of the year. Maverick Capital is a long/ short Read More
Driving Brink – security is an ever rising-concern, whether it be on the cyber front or tangible one. Brink’s armored vehicle transportation, automated teller machines and international transportation of valuables will always be in demand. Brink’s logistics and security solutions also cater to a broad range of customers, including banks and financial institutions, retailers, government agencies, mints and jewelers.
Unlike the U.S., which has a strong infrastructure for moving money, many developing countries do not, including most of Latin America. A couple of years ago, Brink’s didn’t have a presence in Mexico. Now it does. Another key Latin American market is Brazil. The infrastructure buildout in Brazil will ultimately be a big positive for promoting security services.
Its non-compete agreement with Brink’s Home Security has expired. Meaning that Brink’s Company is free to re-enter the home security business. The spinoff ultimately made Brink’s a growth story, where its now highly exposed to the emerging markets’ commercial security business. However, we believe that by re-entering the home security market, Brink’s Company would get a relatively quick and easy boost in revenues. It already has domain experience in the area and has been getting inquiries about offering home security solutions. The Brink’s brand is still the number two brand in the home security market.
One of Brink’s Company other exciting opportunities lies in payment services, where the company can accept and process payments for various billers. Is a split up of its logistics and transportation business from its payments business in the works?