Marcato Capital Says Life Fit Holdings Climb to $70
Marcato Capital Management, an activist hedge fund, announced that Life Time Fitness Inc.’s shares price could jump to $70 if it spins off some of its real estate assets.
Life
Time said last month it was thinking about converting some real estate
assets into a real estate investment trust, which helped push up shares
in late August. On Friday, Life Time stock jumped 6.3 percent to $50.04
after Marcato's comments.
Marcato,
a $3 billion hedge fund that is Life Time's biggest investor with an 8
percent stake, said the kind of spinoff the company is considering
should be straightforward and could be completed relatively quickly,
possibly within six months.
"Based
on Marcato's analysis, at the mid-point of our valuation range, we
believe the shares of LTM could reach $70 per share upon separation of
the Company's real estate assets," Marcato founder Richard McGuire wrote
in a letter to the company's chief executive officer, Bahram Akradi.
The letter was made public in a filing on Friday.
Source: Reuters
