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Merger Arbitrage Mondays – July 10, 2017

  • July 10, 2017

Merger activity decreased last week with six new deals announced, 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 two new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017109
Total Number of Deals Not Completed in 20176
Total Number of Pending Deals
Cash Deals61
Stock Deals20
Stock & Cash Deals12
Special Conditions7
Total Number of Pending Deals100
Total Deal Size$824.92 billion

New Deals:

  1. The acquisition of Bankrate (RATE) by Red Ventures for $1.4 billion or $14.00 per share in cash.
  2. The acquisition of MRV Communications (MRVC) by ADVA Optical Networking for $50.57 million or $10.00 per share in cash.
  3. The acquisition of NCI (NCIT) by private funds managed by an affiliate of H.I.G. Capital for $190.44 million or $20.00 per share in cash.
  4. The acquisition of Monogram Residential Trust (MORE) by Greystar Growth and Income Fund for $3 billion or $12.00 per share in cash.
  5. The acquisition of HSN (HSNI) by Liberty Interactive Corporation (QVCA) for $2.6 billion in an all stock deal.  Under the terms of the agreement, HSNi shareholders will receive fixed consideration of 1.65 shares of Series A QVC Group common stock for every share of HSNi common stock.
  6. The acquisition of Sparton Corporation (SPA) by Ultra Electronics Holdings for $308.13 million or $23.50 per share in cash.

Deal Updates:

  1. On July 3, 2017, The Federal Trade Commission announced that Broadcom Limited (AVGOhas won U.S. antitrust approval to buy Brocade Communications Systems (BRCD).
  2. On July 3, 2017, Merus Labs International (MSLI) and Norgine B.V. announced that Norgine’s proposed acquisition of all of the issued and outstanding common shares of Merus has been approved by the Spanish anti-trust authority, the Comisión Nacional de los Mercados y la Competencia. Subject to approval of the Arrangement by shareholders, it is anticipated that the Arrangement will be completed on or about July 17, 2017.
  3. On July 3, 2017, The European Commission decided to pause its antitrust review of the merger between Qualcomm (QCOM) and NXP Semiconductors (NXPI), because the regulators need more information from NXP and Qualcomm.
  4. On July 5, 2017, U.S. antitrust regulators ended their investigation into Bass Pro Shops’ $4 billion deal to buy Cabela’s (CAB).
  5. July 7, 2017: The end date for the merger of Gas Natural (EGAS) and First Reserve Energy has been extended to January 7, 2018, as the MPSC’s written order approving the Merger and NCUC’s approval are pending.
  6. On July 7, 2017, Rightside Group (NAME) and Donuts announced that the waiting period was terminated early by the U.S. Federal Trade Commission on July 6, 2017 under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The tender offer is scheduled to expire  on July 26, 2017, unless extended in accordance with applicable SEC rules and the terms of the merger agreement among Donuts and Rightside.
  7. On July 8, 2017, Alere (ALR) announced that its shareholders have voted to approve the previously announced amended merger with Abbott (ABT).

Closed Deals:

  1. The acquisition of Fairpoint Communications (FRP) by Consolidated Communications Holdings (CNSL) on July 3, 2017. It took 210 days for this deal to be completed.
  2. The acquisition of CardConnect (CCN) by First Data Corporation (FDC) on July 6, 2017. It took 38 days for this deal to be completed.
  3. The acquisition of Allied World Assurance Company Holdings (AWH) by Fairfax Financial Holdings Limited (FFH.TO) on July 6, 2017. It took 200 days for this deal to be completed.

Top 10 deals with largest spreads:

SymbolAnnounced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
ProfitAnnualized
Profit
GNW10/23/2016China Oceanwide Holdings Group Co., Ltd. (N/A)$5.43$3.6507/31/201748.77%847.62%
LSCC11/03/2016Canyon Bridge Capital Partners, Inc. (N/A)$8.30$6.5709/30/201726.33%117.21%
DEST12/20/2016Orchestra-Premaman S.A. (KAZI.PA)$3.90$3.2210/31/201721.12%68.22%
WR05/31/2016Great Plains Energy Incorporated (GXP)$60.00$53.1311/30/201712.93%33.00%
MON09/14/2016Bayer AG (BAYRY)$128.00$118.0012/31/20178.47%17.78%
RICE06/19/2017EQT Corporation (EQT)$27.03$25.2812/31/20176.94%14.55%
TWX10/22/2016AT&T, Inc. (T)$107.50$101.2412/31/20176.18%12.97%
WGL01/25/2017AltaGas Ltd. (N/A)$88.25$83.4006/30/20185.82%5.98%
HUN05/22/2017CLARIANT N (CLN.VX)$27.83$26.3312/31/20175.70%11.96%
SGBK03/27/2017Home Bancshares, Inc. (HOMB)$49.00$46.6812/31/20174.97%10.43%

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 Staples (SPLS), Whole Foods (WFM), Cabela’s (CAB), Rite Aid (RAD) and Fortress Investment Group (FIG). 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