Merger Arbitrage Mondays – May 22, 2017
Merger activity decreased last week with two new deals announced and three 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 | 78 |
| Total Number of Deals Not Completed in 2017 | 4 |
| Total Number of Pending Deals |
| Cash Deals | 54 |
| Stock Deals | 21 |
| Stock & Cash Deals | 14 |
| Special Conditions | 9 |
| Total Number of Pending Deals | 98 |
| Total Deal Size | $770.47 billion |
New Deals:
- The acquisition of Patheon (PTHN) by Thermo Fisher Scientific (TMO) for $7.2 billion or $35.00 per hare in cash.
- The acquisition of WashingtonFirst Bankshares (WFBI) by Sandy Spring Bancorp (SASR) for $489 million in an all stock deal. Under the terms of the agreement, WashingtonFirst shareholders are expected to receive .8713 shares of Sandy Spring common stock for each share owned of WashingtonFirst common stock, subject to adjustment if Sandy Spring’s average stock price during a specified measurement period prior to closing is more than $50.15 or less than $37.07 per share.
- The acquisition of Destination Maternity Corporation (DEST) by Orchestra-Prémaman (KAZI.PA) for $100 million in an all stock deal. Under the terms of the Agreement, Destination Maternity shareholders will receive 0.5150 of an Orchestra Prémaman S.A. ordinary share, in the form of American Depositary Shares, for each share of Destination common stock they own. We missed adding this deal on December 20, 2016.
- The acquisition of Cascade Bancorp (CACB) by First Interstate BancSystem (FIBK) for $589 million in a cash plus stock deal. Under the terms of the definitive merger agreement, Cascade shareholders will receive 0.14864 shares of First Interstate Class A common stock and $1.91 in cash in exchange for each share of Cascade common stock they hold. We missed adding this deal on November 17, 2016.
Deal Updates:
- On May 16, 2017, MoneyGram (MGI) announced that its stockholders overwhelmingly voted to approve the company’s pending transaction with Ant Financial at the Special Meeting of MoneyGram stockholders.
- On May 16, 2017, Walgreens (WBA) and Rite Aid (RAD) said they have given the Federal Trade Commission until July 7 to reach a decision on their pending merger, which the commission has been giving antitrust scrutiny since December 2015.
- On May 18, 2017, Norsat International (NSAT) announced that the Special Committee comprising all of the Independent Directors of the Board of Directors, in consultation with the Company’s legal and financial advisors, have reviewed and considered an updated unsolicited proposal from Privet Fund Management to acquire the Company for cash consideration of US$11.00 per share. The Independent Directors have determined that the Privet Proposal constitutes a “Superior Proposal” as defined in the Arrangement Agreement with Hytera. Norsat has delivered written notice to Hytera of the determination of the Independent Directors. Hytera now has a period of five business days to offer to amend the terms of the Arrangement Agreement.
- On May 19, 2017, FBR & Co. (FBRC) announced that its Board of Directors has declared a special cash dividend of $7.61 per common share. The special dividend is being declared in connection with the previously announced combination with B. Riley Financial and is contingent upon the satisfaction or waiver of the closing conditions to the Merger. The special cash dividend will be paid on or about June 1, 2017 to all FBR shareholders of record as of the close of business on May 30, 2017.
Closed Deals:
- The acquisition of Synutra International (SYUT) by Beams Power Investment Limited on May 16, 2017. It took 180 days for this deal to be completed.
- The acquisition of InvenSense (INVN) by TDK Corporation (TTDKY) on May 18, 2017. It took 148 days for this deal to be completed.
- The acquisition of American DG Energy (ADGE) by Tecogen (TGEN) on May 18, 2017. It took 197 days for this deal to be completed.
Top 10 deals with largest spreads:
Closing
Price |
|---|
| RAD | 10/27/2015 | Walgreens Boots Alliance, Inc. (WBA) | $6.50 | $3.46 | 07/31/2017 | 87.86% | 458.13% |
| DEST | 12/20/2016 | Orchestra-Premaman S.A. (KAZI.PA) | $5.99 | $3.68 | 06/30/2017 | 62.65% | 586.32% |
| GNW | 10/23/2016 | China Oceanwide Holdings Group Co., Ltd. (N/A) | $5.43 | $3.64 | 06/30/2017 | 49.18% | 460.24% |
| LSCC | 11/03/2016 | Canyon Bridge Capital Partners, Inc. (N/A) | $8.30 | $6.99 | 06/30/2017 | 18.74% | 175.40% |
| CAB | 10/03/2016 | Bass Pro Shops (N/A) | $61.50 | $52.77 | 09/30/2017 | 16.54% | 46.09% |
| WR | 05/31/2016 | Great Plains Energy Incorporated (GXP) | $60.00 | $51.90 | 06/30/2017 | 15.61% | 146.06% |
| MON | 09/14/2016 | Bayer AG (BAYRY) | $128.00 | $116.10 | 12/31/2017 | 10.25% | 16.78% |
| TWX | 10/22/2016 | AT&T, Inc. (T) | $107.50 | $97.63 | 12/31/2017 | 10.11% | 16.55% |
| SGBK | 03/27/2017 | Home Bancshares, Inc. (HOMB) | $49.00 | $45.40 | 12/31/2017 | 7.93% | 12.98% |
| ALR | 02/01/2016 | Abbott Laboratories (ABT) | $51.00 | $47.48 | 09/30/2017 | 7.41% | 20.66% |
List of all pending deals:
The list of all pending deals is only available to InsideArbitrage Premium and Plus members.
Disclaimer: I hold positions in Cabela’s (CAB), Rite Aid (RAD), 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.
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