We invested in Manitowoc Foodservice, Inc. (NYSE:MFS), after its March 4, 2016 spinoff from its parent company, a restructuring designed to unlock the value of the parent’s less cyclical foodservice equipment business from its highly cyclical crane business. Like Middleby, Manitowoc is focused mainly on commercial and institutional foodservice operators, with leading positions in more than half of its brands. It manufactures and distributes an integrated portfolio of hot and cold category products and supplies. We believe the spinoff will allow Manitowoc’s new management team to focus exclusively on the core food equipment business and lift margins to industry levels through organic growth and restructuring. In addition, we think opportunity exists for Manitowoc to consolidate a fragmented industry.
From Baron Funds' Second Quarter Insight: Finding Growth in Industrials.
