CHICAGO - Institutional investors are upbeat about Sears, Roebuck & Co.'s proposed divestiture of Allstate Corp.
But not all investors see the move as a buying opportunity for either company's stock.
In terms of Allstate's own money management, spokesman Al Orendorff said it was premature to speculate what form the company's institutional investment management business might take after separation from Sears.
Allstate is a fixed-income manager, mainly offering guaranteed investment contracts that totaled just more than $6 billion as of Jan. 1, 1993, the most recent date for which the company was willing to provide information.
Sears owns 80.1% of the insurer and shareholders welcomed the divestiture.
"We generally support Sears' efforts to increase shareholder value," said Luther Jones, manager-corporate affairs at the $38 billion Florida State Board of Administration, Tallahassee.
"The market obviously believes that the concept will increase shareholder value, since the value of the stock is up 5% today (last Thursday) or two-thirds to 515/8," Mr. Jones said.
The Florida Board holds 1,852,600 shares of Sears stock. Its holdings of Allstate were unavailable, although they appear to be small.
At Sunbank Capital Management N.A., Orlando, Fla., Robert Buhrmann, senior vice president, is upbeat.
"I think it's a positive move for both Sears and Allstate," he said. "Both can focus fully now on their own businesses with less restriction and more flexibility.
But "it's not a buying opportunity" for either stock, he said. He added the prices of the stocks already reflect the current values.
Sunbank already had a hold on Allstate stock, and plans to continue the hold with the Sears announcement of its plans to spin off the rest of Allstate next year to Sears' shareholders. The spinoff is valued at $9 billion, one of the largest in history. Sears also is exploring the divestiture of its Homart Development Co. unit.
Mr. Buhrmann declined to disclose how much Allstate stock Sunbank owns. It doesn't own any Sears stock.
Allstate might have to take a nickel or dime per share out of its earnings in the first quarter because of the loss of tax benefits from Sears, he said.
"The market is already familiar with Allstate because it has been a public company for about a year. (Sears spun off 19.9% of Allstate in June 1993.) So it knows what there is to know.
"Allstate has been cutting costs. But the property-casualty business is not wonderful," Mr. Buhrmann said.
"There is a lot of competition, and the returns are not great. Both of these are good companies. Sears' merchandising group has made great strides, but that's already been reflected in the stock," he added.