Merger Arbitrage Mondays – April 24, 2017

Merger activity decreased last week with three new deals announced and five deals closing. You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.

There were four new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017 63
Total Number of Deals Not Completed in 2017 3
Total Number of Pending Deals
Cash Deals 51
Stock Deals 17
Stock & Cash Deals 12
Special Conditions 9
Total Number of Pending Deals 89
Total Deal Size $712.27 billion

New Deals:

  1. The acquisition of MOCON (MOCO) by AMETEK (AME) for $182 million or $30.00 per share in cash.
  2. The acquisition of KCG Holdings (KCG) by Virtu Financial (VIRT) for $1.56 billion or $20.00 per share in cash. We were tracking this potential deal in the Deals in the Works Tool since March 15th, the day after news broke about the potential deal. The stock closed at $16.90 on that day, providing a potential profit of 18% on the deal.
  3. The acquisition of C. R. Bard (BCR) by Becton, Dickinson and Company (BDX) FOR $24 billion in a cash plus stock deal. Under the terms of the agreement, shareholders of C. R. Bard will receive approximately $222.93 in cash and 0.5077 shares of BD stock per Bard share, or a total of value of $317.00 per Bard common share based on BD’s closing price on April 21, 2017.

Deal Updates:

  1. On April 17, 2017, Bass Pro Shops announced that it is lowering the price it will pay to buy  Cabela’s (CAB) as part of an amended merger agreement. Bass Pro will now acquire Cabela’s for $61.50 per share in cash, or about $5 billion. I decided to start a position in Cabela’s after this new agreement was negotiation as the deal still provided an IRR of over 15%.
  2. On April 17, 2017, Fidelity & Guaranty Life (FGL) announced that it has terminated its Merger Agreement with Anbang Insurance Group. The Company’s Board of Directors is continuing to evaluate strategic alternatives to maximize shareholder value and has received interest from a number of parties. The FGL stock did not drop below the deal price after the merger was terminated.
  3. On April 17, 2017, Stillwater Mining Company (SWC) announced that it has been informed that the review by the Committee on Foreign Investment in the United States (CFIUS) related to the proposed acquisition of the Company by Sibanye Gold Limited (SBGL) has been completed, and there are no unresolved national security issues with respect to the transaction. Both Stillwater and Sibanye Gold Limited have scheduled shareholders’ meetings on April 25, 2017 to conduct voting related to the proposed merger.
  4. On April 17, 2017, Energy Transfer Partners (ETP) announced that all three proxy advisory firms, Institutional Shareholder Services, Glass Lewis & Co., and Egan-Jones Proxy Services have recommended that ETP unitholders vote “FOR” approval of the proposed merger with Sunoco Logistics Partners (SXL), which will be considered at the April 26, 2017 special meeting of ETP unitholders.
  5. On April 18, 2017, The U.S. Federal Communications Commission said that it approved Time Warner’s (TWX) sale of a broadcast station in Atlanta to Meredith Corp (MDP), a transaction that could help speed Time Warner’s planned merger with AT&T (T).
  6. On April 18, 2017, InvenSense (INVN) announced that all necessary regulatory clearances have been received for the acquisition by TDK Corporation (TTDKY) of InvenSense, including from the Committee on Foreign Investment in the United States (CFIUS) and all other necessary regulatory authorities, and the required waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has expired. InvenSense will hold a special meeting of its stockholders on May 17, 2017, at which stockholders will be asked to approve, among other items, the previously announced transaction. The companies expect to close the transaction shortly thereafter.
  7. On April 19, 2017, The KCC rejected the merger application filed jointly by Westar Energy (WR) and Great Plains Energy (GXP) with the Kansas Corporation Commission requesting approval of the merger. Westar Energy is evaluating the written order.

Closed Deals:

  1. The acquisition of Nimble Storage (NMBL) by Hewlett Packard Enterprise Company (HPE) on April 17, 2017. It took 42 days for this deal to be completed.
  2. The acquisition of Ixia (XXIA) by Keysight Technologies (KEYS) on April 18, 2017. It took 78 days for this deal to be completed.
  3. The acquisition of Cardinal Financial (CFNL) by United Bankshares (UBSI) on April 21, 2017. It took 246 days for this deal to be completed.
  4. The acquisition of Air Methods Corporation (AIRM) by American Securities on April 21, 2017. It took 38 days for this deal to be completed.
  5. The acquisition of Chemtura Corporation (CHMT) by LANXESS AG  on April 21, 2017. It took 207 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annualized
Profit
RAD 10/27/2015 Walgreens Boots Alliance, Inc. (WBA) $6.50 $3.80 07/31/2017 71.05% 264.63%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.07 06/30/2017 33.42% 182.04%
BCR 04/23/2017 Becton, Dickinson and Company (BDX) $317.00 $253.07 11/30/2017 25.26% 41.91%
LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) $8.30 $6.85 03/31/2017 21.17% -321.93%
WR 05/31/2016 Great Plains Energy Incorporated (GXP) $60.00 $51.43 06/30/2017 16.66% 90.78%
MON 09/14/2016 Bayer AG (BAYRY) $128.00 $115.50 12/31/2017 10.82% 15.74%
CAB 10/03/2016 Bass Pro Shops (N/A) $61.50 $56.94 09/30/2017 8.01% 18.38%
GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) $5.10 $4.725 12/31/2017 7.94% 11.54%
MBVT 10/24/2016 Community Bank System Inc. (CBU) $52.43 $48.60 06/30/2017 7.87% 42.88%
ADGE 11/02/2016 Tecogen Inc. (TGEN) $0.34 $0.3185 06/30/2017 7.74% 42.18%

List of all pending deals:

  Symbol Announced
Date
Acquiring
Company
Deal
Type
Closing
Value
Closing
Price
Last
Price
Volume Closing
Date
Profit Annu.
Profit
+ RAD 10/27/2015 Walgreens Boots Alliance, Inc. (WBA) All Cash $17.2 billion $6.50 $3.80 28,454,221 07/31/2017 71.05% 264.63%
+ GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) All Cash $2.7 billion $5.43 $4.07 2,373,019 06/30/2017 33.42% 182.04%
+ BCR 04/23/2017 Becton, Dickinson and Company (BDX) Cash Plus Stock $24 billion $317.00 $253.07 413,824 11/30/2017 25.26% 41.91%
+ LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) All Cash $1.3 billion $8.30 $6.85 463,181 03/31/2017 21.17% 0.00%
+ WR 05/31/2016 Great Plains Energy Incorporated (GXP) Special Conditions $12.2 billion $60.00 $51.43 2,812,766 06/30/2017 16.66% 90.78%
+ MON 09/14/2016 Bayer AG (BAYRY) All Cash $66 billion $128.00 $115.50 2,053,217 12/31/2017 10.82% 15.74%
+ CAB 10/03/2016 Bass Pro Shops (N/A) All Cash $5 billion $61.50 $56.94 449,607 09/30/2017 8.01% 18.38%
+ GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) All Cash $1.3 billion $5.10 $4.725 580,197 12/31/2017 7.94% 11.54%
+ MBVT 10/24/2016 Community Bank System Inc. (CBU) All Stock $304 million $52.43 $48.60 16,555 06/30/2017 7.87% 42.88%
+ ADGE 11/02/2016 Tecogen Inc. (TGEN) All Stock $20 million $0.34 $0.3185 28,373 06/30/2017 7.74% 42.18%
+ TWX 10/22/2016 AT&T, Inc. (T) Special Conditions $108.7 billion $107.50 $99.84 3,561,714 12/31/2017 7.67% 11.16%
+ WGL 01/25/2017 AltaGas Ltd. (N/A) All Cash $6.4 billion $88.25 $82.14 189,309 06/30/2018 7.44% 6.28%
+ SGBK 03/27/2017 Home Bancshares, Inc. (HOMB) Special Conditions $778.4 million $49.00 $45.66 124,646 12/31/2017 7.31% 10.64%
+ AMFW 03/13/2017 John Wood Group Plc (WG.L) All Stock $4.3 billion $7.54 $7.13 29,976 12/31/2017 5.82% 8.46%
+ NXPI 10/27/2016 QUALCOMM Incorporated (QCOM) All Cash $38 billion $110.00 $104.36 1,812,528 12/31/2017 5.40% 7.86%
+ XCRA 04/10/2017 an affiliate of Sino IC Capital and Unic Capital Management (N/A) All Cash $439.97 million $10.25 $9.73 626,286 12/31/2017 5.34% 7.77%
+ EGAS 10/11/2016 First Reserve Energy Infrastructure (N/A) All Cash $196 million $13.10 $12.55 8,873 12/31/2017 4.38% 6.37%
+ LVLT 10/31/2016 CenturyLink, Inc. (CTL) Cash Plus Stock $34 billion $62.67 $60.06 1,619,051 09/30/2017 4.35% 9.98%
+ ALR 02/01/2016 Abbott Laboratories (ABT) All Cash $5.3 billion $51.00 $48.90 1,668,387 09/30/2017 4.29% 9.86%
+ CFCB 01/26/2017 Midland States Bancorp, Inc. (MSBI) Special Conditions $175.1 million $26.75 $25.77 3,952 06/30/2017 3.80% 20.72%
+ SYT 02/03/2016 ChemChina (N/A) All Cash $43 billion $93.95 $90.57 5,530,045 06/30/2017 3.73% 20.33%
+ FBRC 02/21/2017 B. Riley Financial, Inc. (RILY) Cash Plus Stock $160.1 million $18.40 $17.75 101,677 06/30/2017 3.65% 19.87%
+ ANCB 04/11/2017 Washington Federal, Inc. (WAFD) Special Conditions $63.9 million $25.75 $24.85 9,231 09/30/2017 3.62% 8.31%
+ RBPAA 01/30/2017 Bryn Mawr Bank Corporation (BMTC) All Stock $127.7 million $4.28 $4.14 117,163 09/30/2017 3.37% 7.73%
+ MBLY 03/13/2017 Intel Corporation (INTC) All Cash $14.7 billion $63.54 $61.67 4,012,180 12/31/2017 3.03% 4.41%
+ CUNB 04/06/2017 PacWest Bancorp (PACW) Cash Plus Stock $705 million $37.72 $36.65 696,733 12/31/2017 2.93% 4.26%
+ DGI 02/24/2017 MacDonald, Dettwiler and Associates Ltd. (MDA.TO) Cash Plus Stock $3.6 billion $33.74 $32.95 246,499 12/31/2017 2.41% 3.50%
+ HW 11/20/2016 Boral Limited (N/A) All Cash $2.6 billion $24.25 $23.70 701,756 06/30/2017 2.32% 12.64%
+ OKSB 12/14/2016 Simmons First National Corporation (SFNC) Cash Plus Stock $564.4 million $25.52 $24.95 33,441 09/30/2017 2.30% 5.27%
+ AWH 12/18/2016 Fairfax Financial Holdings Limited (FFH.TO) Special Conditions $4.9 billion $54.00 $52.94 595,794 06/30/2017 2.00% 10.91%
+ EVBS 12/13/2016 Southern National Bancorp of Virginia, Inc. (SONA) All Stock $178.3 million $10.98 $10.78 6,734 06/30/2017 1.84% 10.02%
+ NVET 04/13/2017 Zoetis Inc. (ZTS) All Cash $26.93 million $6.72 $6.60 53,952 12/31/2017 1.82% 2.64%
+ XRA 03/28/2017 Goldcorp Inc. (GG) All Stock $184.45 $1.82 $1.79 370,125 06/30/2017 1.56% 8.52%
+ BRCD 11/02/2016 Broadcom Limited (AVGO) All Cash $5.5 billion $12.75 $12.56 2,569,271 10/31/2017 1.51% 2.91%
+ WOOF 01/07/2017 Mars, Incorporated (N/A) All Cash $9.1 billion $93.00 $91.63 634,211 09/30/2017 1.50% 3.43%
+ MJN 02/10/2017 Reckitt Benckiser Group (N/A) All Cash $17.9 billion $90.00 $88.76 1,373,057 09/30/2017 1.40% 3.21%
+ FRP 12/05/2016 Consolidated Communications Holdings, Inc. (CNSL) All Stock $1.5 billion $17.53 $17.30 124,089 06/30/2017 1.36% 7.39%
+ PCBK 01/09/2017 Columbia Banking System, Inc. (COLB) All Stock $644.1 million $25.13 $24.80 100,452 06/30/2017 1.35% 7.36%
+ ZPIN 04/06/2017 SEEK International Investments Pty Ltd. (N/A) All Cash $678.59 million $18.20 $17.92 35,836 12/31/2017 1.28% 1.87%
+ KCG 04/20/2017 Virtu Financial, Inc. (VIRT) All Cash $1.56 billion $20.00 $19.75 2,656,827 09/30/2017 1.27% 2.91%
+ SYUT 11/17/2016 Beams Power Investment Limited (N/A) All Cash N/A $6.05 $5.975 136,747 04/30/2017 1.26% 76.36%
+ FIG 02/14/2017 SoftBank Group Corp. (SFTBY) All Cash $3.3 billion $8.08 $7.98 2,565,180 12/31/2017 1.25% 1.82%
+ AF 03/07/2017 Sterling Bancorp (STL) All Stock $2.2 billion $20.48 $20.23 728,387 12/31/2017 1.21% 1.76%
+ MGI 01/26/2017 Ant Financial Services Group (N/A) All Cash $1.2 billion $18.00 $17.79 750,254 12/31/2017 1.18% 1.72%
+ FCFP 02/06/2017 First Busey Corporation (BUSE) Cash Plus Stock $235.8 million $13.25 $13.10 36,364 06/30/2017 1.17% 6.39%
+ UCP 04/11/2017 Century Communities, Inc. (CCS) Cash Plus Stock $336 million $11.53 $11.40 78,774 09/30/2017 1.15% 2.64%
+ AIQ 04/11/2017 Tahoe Investment Group Co., Ltd. (N/A) All Cash $682 million $13.25 $13.10 27,079 09/30/2017 1.15% 2.63%
+ DGAS 02/21/2017 Peoples Natural Gas (N/A) All Cash $227 million $30.50 $30.20 25,734 12/31/2017 0.99% 1.44%
+ LMOS 02/20/2017 EQT Infrastructure investment strategy (N/A) All Cash $950 million $18.00 $17.83 79,518 09/30/2017 0.95% 2.19%
+ LMIA 02/17/2017 Sonaca Group (N/A) All Cash $381.47 million $14.00 $13.87 109,675 06/30/2017 0.94% 5.11%
+ SGM 01/26/2017 Home Point Financial Corporation (N/A) All Cash $211 million $8.00 $7.93 59,841 06/30/2017 0.88% 4.81%
+ SALE 04/10/2017 Harland Clarke Holdings Corp. (N/A) All Cash $216 million $11.60 $11.50 1,168,562 06/30/2017 0.87% 4.74%
+ NSR 12/14/2016 private investment group led by Golden Gate Capital (N/A) All Cash $2.9 billion $33.50 $33.25 186,591 09/30/2017 0.75% 1.73%
+ CACQ 12/22/2014 Caesars Entertainment Corporation (CZR) All Stock N/A $15.76 $15.65 320,850 03/31/2017 0.72% 0.00%
+ MOCO 04/17/2017 AMETEK, Inc. (AME) All Cash $182 million $30.00 $29.80 98,753 09/30/2017 0.67% 1.54%
+ PVTB 06/29/2016 Canadian Imperial Bank of Commerce (CM) Cash Plus Stock $4.9 billion $58.80 $58.42 408,572 06/30/2017 0.65% 3.53%
+ SNOW 04/10/2017 An entity controlled by affiliates of the Aspen Skiing Compan and KSL Capital Partners (N/A) All Cash $1.5 billion $23.75 $23.60 250,359 09/30/2017 0.64% 1.46%
+ ETP 11/21/2016 Sunoco Logistics Partners L.P. (SXL) All Stock $19.93 billion $35.33 $35.12 2,793,074 03/31/2017 0.58% 0.00%
+ TRR 03/31/2017 New Mountain Capital (N/A) All Cash $438 million $17.55 $17.45 638,866 06/30/2017 0.57% 3.12%
+ SWFT 04/10/2017 Knight Transportation, Inc. (KNX) All Stock $3.24 bilion $24.52 $24.38 3,327,477 09/30/2017 0.56% 1.28%
+ INVN 12/21/2016 TDK Corporation (TTDKY) All Cash $1.3 billion $13.00 $12.93 3,578,448 09/30/2017 0.54% 1.24%
+ OKS 02/01/2017 ONEOK, Inc. (OKE) All Stock $17.2 billion $52.73 $52.45 692,395 06/30/2017 0.53% 2.88%
+ VAL 03/20/2016 The Sherwin-Williams Company (SHW) All Cash $11.3 billion $113.00 $112.43 675,145 06/21/2017 0.51% 3.19%
+ ERS 03/31/2017 A unit of Ta Chen Stainless Pipe Co., Ltd. (N/A) All Cash $160.57 million $7.00 $6.97 10,383 06/30/2017 0.43% 2.34%
+ CST 08/22/2016 Alimentation Couche-Tard Inc. (N/A) All Cash $4.4 billion $48.53 $48.33 478,007 03/31/2017 0.41% 0.00%
+ SWC 12/09/2016 Sibanye Gold Limited (SBGL) All Cash $2.2 billion $18.00 $17.93 2,874,397 06/30/2017 0.39% 2.13%
+ GTWN 10/06/2016 Salem Five Bancorp (N/A) All Cash $49.2 million $26.00 $25.90 7 03/31/2017 0.39% 0.00%
+ ALJ 01/03/2017 Delek US Holdings, Inc. (DK) All Stock $1.27 billion $11.27 $11.23 379,987 06/30/2017 0.35% 1.91%
+ EXAR 03/29/2017 MaxLinear, Inc. (MXL) All Cash $472 million $13.00 $12.96 934,621 06/30/2017 0.31% 1.68%
+ MPSX 01/24/2017 WestRock Company (WRK) All Cash $2.28 billion $18.00 $17.95 152,715 06/30/2017 0.28% 1.52%
+ PNRA 04/05/2017 JAB (N/A) All Cash $7.5 billion $315.00 $314.27 448,431 09/30/2017 0.23% 0.53%
+ UAM 11/17/2016 WellCare Health Plans, Inc. (WCG) All Cash $800 million $10.00 $9.98 215,541 06/30/2017 0.20% 1.09%
+ UTEK 02/02/2017 Veeco Instruments Inc. (VECO) Cash Plus Stock $550 million $30.04 $30.01 139,939 06/30/2017 0.11% 0.59%
+ EVER 08/08/2016 TIAA (N/A) All Cash $2.5 billion $19.50 $19.48 400,580 06/30/2017 0.10% 0.56%
+ MEP 01/26/2017 Enbridge Inc. (ENB) All Cash $170.2 million $8.00 $8.00 33,930 06/30/2017 0.00% 0.00%
+ ZLTQ 02/13/2017 Allergan plc (AGN) All Cash $2.475 billion $56.50 $56.50 405,728 12/31/2017 0.00% 0.00%
+ FOR 04/13/2017 affiliates of Starwood Capital Group (N/A) All Cash $442.77 million $14.25 $14.25 856,503 09/30/2017 0.00% 0.00%
+ WNR 11/17/2016 Tesoro Corporation (TSO) All Stock $6.4 billion $33.88 $33.90 1,586,409 06/30/2017 -0.05% -0.29%
+ SBY 02/27/2017 Tricon Capital Group Inc. (N/A) All Cash $1.4 billion $21.50 $21.55 111,599 06/30/2017 -0.23% -1.26%
+ BNCN 01/23/2017 Pinnacle Financial Partners, Inc. (PNFP) All Stock $1.9 billion $33.71 $33.85 161,096 09/30/2017 -0.40% -0.93%
+ ELOS 04/03/2017 Funds advised by Apax Partners (N/A) All Cash $319.66 million $11.00 $11.05 252,416 06/30/2017 -0.45% -2.47%
+ CWEI 01/17/2017 Noble Energy, Inc. (NBL) Cash Plus Stock $3.2 billion $129.94 $132.90 252,250 06/30/2017 -2.23% -12.13%
+ GNVC 01/24/2017 Intrexon Corporation (XON) All Stock $6.3 million $5.99 $6.22 46,738 06/30/2017 -3.69% -20.10%
+ NSAT 03/27/2017 Hytera Project Corp. (N/A) All Cash $62 million $10.25 $10.90 29,899 06/30/2017 -5.96% -32.49%
+ GNCMA 04/04/2017 Liberty Ventures (LVNTA) Special Conditions $2.68 billion $32.50 $36.26 151,875 06/30/2017 -10.37% -56.49%
+ ISLE 09/19/2016 Eldorado Resorts, Inc. (ERI) All Cash $1.7 billion $23.00 $26.01 568,994 06/30/2017 -11.57% -63.04%
+ STRP 04/10/2017 AT&T Inc. (T) Special Conditions $1.6 billion $95.63 $109.59 248,401 03/31/2018 -12.74% -13.63%
+ INNL 04/04/2017 Gurnet Point L.P. (N/A) Special Conditions $209 million $1.75 $2.07 235,687 06/30/2017 -15.46% -84.22%
+ RAI 01/17/2017 British American Tobacco p.l.c. (BTI) Cash Plus Stock $49.4 billion $47.00 $63.67 3,543,534 09/30/2017 -26.18% -60.10%

Disclaimer: I hold positions in Cabela’s (CAB), Rite Aid (RAD), Syngenta (SYT), Fortress Investment Group (FIG) and NXP Semiconductors (NXPI). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria or follow me on Twitter@asifsuria

2 Comments

  1. GeorgeCiardi
    April 24, 2017 at 5:40 am

    There were a few other mergers I noticed the past week you might want to consider adding. They were:

    Forestar Group Inc. (FOR)
    Harmony Merger Corp. (HRMN)
    Nivalis Therapeutics, Inc (NVLS)

    Each are a bit of a funky deal type but might be interesting to watch.

  2. Asif Suria
    April 24, 2017 at 10:20 am

    Thank you George. We added FOR last week and it is on the tool. Regarding HRMN, it is a reverse merger and hence we are not tracking it. I will check out NVLS.

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