Sherwin Williams: Is a Buyer Coming?

Feb. 6.08 | About: The Sherwin-Williams (SHW)

Farallon Capital Management is making a big bet on Sherwin Williams (NYSE:SHW), buying 5.2% of the company's stock. Who is Farrallon and why are they buying into Sherwin? Well, perhaps they feel as I do that it is fantastically undervalued?

From the Farrallon website:
Farallon's investment philosophy
is to invest in businesses and securities that are undergoing change. Farallon’s investments are primarily those in which a known or expected event (a merger, restructuring, recapitalization or other major change) will cause an appreciation in the value of the particular investment. Investments include public and private debt and equity securities, direct investments in private companies and real estate.
Now, we know Sherwin is not undergoing a restructuring or a recapitalization. That leaves only one thing in their thought process, merger or buyout. Things are getting interesting...

Disclosure: Long Sherwin.