The parent will trade at a ridiculously low valuation once it takes its cash cow subsidiary private at a steal of a price.
There are two ways to play a lowball take-private. You can own the target and bet the offer gets raised, or you can own the company making the offer, since it is the one actually getting the great deal. That second option is especially interesting when the buyer trades at 2x pro-forma EBITDA, with very high cash conversion, and has just told the market it plans to improve its shareholder return policy once the deal closes.
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