Merger Arbitrage Mondays – September 11, 2017

Merger activity decreased last week with four 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 was one new deal announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017 144
Total Number of Deals Not Completed in 2017 8
Total Number of Pending Deals
Cash Deals 53
Stock Deals 24
Stock & Cash Deals 12
Special Conditions 10
Total Number of Pending Deals 99
Total Deal Size $905 billion

New Deals:

  1. The acquisition of Rockwell Collins (COL) by United Technologies (UTX) for $30 billion in a cash plus stock deal. Under the terms of the agreement, each Rockwell Collins shareowner will receive $93.33 per share in cash and $46.67 in shares of UTC common stock, subject to a 7.5 percent collar centered on UTC’s August 22, 2017 closing share price of $115.69. We are treating this as a special conditions deal.
  2. The acquisition of YuMe (YUME) by RhythmOne (RTHM.L) for $102.36 million in a cash plus stock deal. Under the terms of the agreement, YuMe shareholders will receive $1.70 per share in cash and 7.325 shares in RhythmOne stock.
  3. The acquisition of Landauer (LDR) by Fortive Corporation (FTV) for $770 million or $67.25 per share in cash.
  4. Cogint (COGT) entered into a definitive transaction agreement with BlueFocus International Limited, under which cogint and BlueFocus will combine their businesses. In the transaction, BlueFocus will contribute to cogint (1) $100 million in cash, (2) Canadian-based marketing communications company Vision7 International, (3) U.K.-based global socially-led creative agency We Are Very Social Limited, and (4) Indigo Social. As part of the transaction, immediately prior to the closing, cogint will spin-off its data and analytics operations and assets into a public company, expected to be listed on NASDAQ, named Red Violet, Inc.. The shares of Red Violet will be distributed to cogint’s shareholders as of a record date to be determined as a stock dividend upon closing of the transaction. Since we can’t determine the value of the combined company with certainty, we are not going to add this deal to the Merger Arbitrage Tool. We will be tracking the spinoff in our list of upcoming spinoffs.

Deal Updates:

  1. On September 4, 2017, The Chilean Fiscalía Nacional Económica (FNE) approved AT&T’s (T) pending acquisition of Time Warner (TWX).
  2. On September 6, 2017, Cabela’s Incorporated (CAB) was notified that the Board of Governors of the Federal Reserve (the “FRB”) has approved the previously announced sale of the assets and liabilities of the Company’s wholly owned bank subsidiary, World’s Foremost Bank, to Synovus Bank. The double digit spread on this deal narrowed immediately following this news and the spread is currently less than 1%.
  3. On September 6, 2017, EU antitrust regulators have halted for a second time their review of U.S. smartphone chipmaker Qualcomm’s (QCOM) $38-billion bid for NXP Semiconductors (NXPI) after the companies failed to provide key details of the deal.
  4. On September 7, 2017, Wabash National Corporation (WNC) announced that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, or HSR Act, applicable to the acquisition of Supreme Industries (STS) by Wabash National expired on September 6, 2017.
  5. On September 7, 2017, in connection with the previously announced agreement to acquire Guidance Software (GUID), OpenText (OTEX) announced that it has extended the expiration of its tender offer to acquire all of the outstanding shares of Guidance’s common stock.  The tender offer is now scheduled to expire on September 13, 2017, unless it is further extended.
  6. We have re-classified the CombiMatrix Corporation (CBMX) deal as a ‘special conditions deal’, since the consideration payable to CombiMatrix shareholders is a fixed amount of $27 million paid in Invitae Corporation (NVTA) stock and subject to an adjustment for “Net Cash” of CombiMatrix at closing.

Closed Deals:

  1. The acquisition of Nord Anglia Education (NORD) by Canada Pension Plan Investment Board and Baring Private Equity Asia on September 5, 2017. It took 133 days for this deal to be completed.
  2. The acquisition of Rocket Fuel (FUEL) by Sizmek on September 6, 2017. It took 50 days for this deal to be completed.
  3. The acquisition of Swift Transportation Company (SWFT) by Knight Transportation (KNX) on September 10, 2017. It took 153 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
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $3.45 11/30/2017 57.39% 261.85%
LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) $8.30 $5.63 09/30/2017 47.42% 911.05%
MGI 01/26/2017 Ant Financial Services Group (N/A) $18.00 $16.40 12/31/2017 9.76% 32.08%
HUN 05/22/2017 CLARIANT N (CLN.VX) $29.45 $26.84 12/31/2017 9.74% 32.02%
YUME 09/05/2017 RhythmOne plc (RTHM.L) $5.18 $4.72 03/31/2018 9.67% 17.56%
CBMX 07/31/2017 Invitae Corporation (NVTA) $8.33 $7.60 12/31/2017 9.61% 31.58%
SGBK 03/27/2017 Home Bancshares, Inc. (HOMB) $49.00 $44.83 12/31/2017 9.30% 30.59%
MON 09/14/2016 Bayer AG (BAYRY) $128.00 $117.42 12/31/2017 9.01% 29.63%
NXTM 08/07/2017 Fresenius Medical Care (N/A) $30.00 $27.88 06/30/2018 7.60% 9.51%
TWX 10/22/2016 AT&T, Inc. (T) $107.50 $100.20 12/31/2017 7.29% 23.96%

List of all pending deals:

  Symbol Announced
Date
Acquiring
Company
Deal
Type
Closing
Value
Closing
Price
Last
Price
Volume Closing
Date
Profit Annu.
Profit
+ GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) All Cash $2.7 billion $5.43 $3.45 4,356,031 11/30/2017 57.39% 261.85%
+ LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) All Cash $1.3 billion $8.30 $5.63 165,096 09/30/2017 47.42% 911.05%
+ HUN 05/22/2017 CLARIANT N (CLN.VX) All Stock $6.72 billion $29.50 $26.84 1,769,649 12/31/2017 9.92% 32.62%
+ MGI 01/26/2017 Ant Financial Services Group (N/A) All Cash $1.2 billion $18.00 $16.40 412,067 12/31/2017 9.76% 32.08%
+ YUME 09/05/2017 RhythmOne plc (RTHM.L) Cash Plus Stock $102.36 million $5.18 $4.72 531,861 03/31/2018 9.71% 17.63%
+ CBMX 07/31/2017 Invitae Corporation (NVTA) Special Conditions $20.22 million $8.33 $7.60 15,623 12/31/2017 9.61% 31.58%
+ SGBK 03/27/2017 Home Bancshares, Inc. (HOMB) Special Conditions $778.4 million $49.00 $44.83 336,299 12/31/2017 9.30% 30.59%
+ MON 09/14/2016 Bayer AG (BAYRY) All Cash $66 billion $128.00 $117.42 824,615 12/31/2017 9.01% 29.63%
+ NXTM 08/07/2017 Fresenius Medical Care (N/A) All Cash $1.62 billion $30.00 $27.88 548,815 06/30/2018 7.60% 9.51%
+ TWX 10/22/2016 AT&T, Inc. (T) Special Conditions $108.7 billion $107.50 $100.20 4,917,803 12/31/2017 7.29% 23.96%
+ COL 09/04/2017 United Technologies Corp. (UTX) Special Conditions $30 billion $140.00 $130.95 2,786,147 09/30/2018 6.91% 6.57%
+ DMTX 08/25/2017 Regenxbio Inc. (RGNX) All Stock $41 million $4.04 $3.80 101,975 12/31/2017 6.38% 20.99%
+ XCRA 04/10/2017 an affiliate of Sino IC Capital and Unic Capital Management (N/A) All Cash $439.97 million $10.25 $9.73 296,039 12/31/2017 5.34% 17.57%
+ SNI 07/31/2017 Discovery Communications, Inc. (DISCK) Special Conditions $14.6 billion $90.00 $85.47 760,469 03/31/2018 5.30% 9.62%
+ WGL 01/25/2017 AltaGas Ltd. (N/A) All Cash $6.4 billion $88.25 $84.38 117,331 06/30/2018 4.59% 5.73%
+ TRCO 05/08/2017 Sinclair Broadcast Group, Inc. (SBGI) Cash Plus Stock $6.6 billion $41.56 $39.80 418,873 12/31/2017 4.41% 14.50%
+ HCOM 07/10/2017 Cincinnati Bell (CBB) Cash Plus Stock $650 million $31.04 $29.86 20,798 12/31/2018 3.94% 3.02%
+ RICE 06/19/2017 EQT Corporation (EQT) Cash Plus Stock $8.2 billion $27.75 $26.79 4,070,334 12/31/2017 3.58% 11.76%
+ BRCD 11/02/2016 Broadcom Limited (AVGO) All Cash $5.5 billion $12.75 $12.31 2,139,200 10/28/2017 3.57% 27.76%
+ ANCB 04/11/2017 Washington Federal, Inc. (WAFD) Special Conditions $63.9 million $25.75 $24.90 1,999 09/30/2017 3.41% 65.58%
+ BKMU 07/20/2017 Associated Banc-Corp (ASB) All Stock $482 million $9.09 $8.80 412,457 03/31/2018 3.34% 6.07%
+ CPN 08/18/2017 Energy Capital Partners (N/A) All Cash $17.3 billion $15.25 $14.76 6,490,978 03/31/2018 3.32% 6.03%
+ SVA 06/26/2017 Sinovac Limited and Sinovac Amalgamation Sub Limited (N/A) All Cash $437.59 million $7.00 $6.80 79,018 12/31/2017 2.94% 9.67%
+ SBCP 08/14/2017 CenterState Banks, Inc. (CSFL) All Stock $176.7 million $20.43 $19.87 27,076 03/31/2018 2.84% 5.16%
+ AKRX 04/24/2017 Fresenius Kabi (N/A) All Cash $4.75 billion $34.00 $33.11 1,356,384 03/31/2018 2.69% 4.88%
+ AVA 07/19/2017 Hydro One Limited (N/A) All Cash $5.3 billion $53.00 $51.74 335,031 12/31/2018 2.44% 1.87%
+ AMFW 03/13/2017 John Wood Group Plc (WG.L) All Stock $4.3 billion $6.16 $6.02 12,619 12/31/2017 2.38% 7.81%
+ ALR 02/01/2016 Abbott Laboratories (ABT) All Cash $5.3 billion $51.00 $49.84 932,027 09/30/2017 2.33% 44.71%
+ STRP 05/11/2017 Verizon Communications Inc. (VZ) Special Conditions $3.1 billion $184.00 $179.90 95,339 03/15/2018 2.28% 4.50%
+ TESO 08/14/2017 Nabors Industries Ltd. (NBR) All Stock $157.23 million $4.43 $4.35 388,622 12/31/2017 1.92% 6.32%
+ XBKS 05/22/2017 Union Bankshares Corporation (UBSH) All Stock $701.2 million $29.05 $28.52 28,832 01/15/2018 1.87% 5.42%
+ ABCO 08/29/2017 Optum and Vista Equity Partners (N/A) Special Conditions $2.66 billion $54.29 $53.35 969,191 03/31/2018 1.76% 3.20%
+ SCLN 06/08/2017 a consortium consisting of entities affiliated with GL Capital Management GP Limited, Bank of China Group Investment Limited, CDH Investments, Ascendent Capital Partners and Boying (N/A) All Cash $605 million $11.18 $11.00 529,473 12/31/2017 1.64% 5.38%
+ SNC 07/26/2017 Markel Corporation (MKL) All Cash $919 million $21.00 $20.68 247,228 12/31/2017 1.55% 5.09%
+ SPA 07/07/2017 Ultra Electronics Holdings (N/A) All Cash $308.13 million $23.50 $23.15 87,947 01/08/2018 1.51% 4.64%
+ DGI 02/24/2017 MacDonald, Dettwiler and Associates Ltd. (MDA.TO) Cash Plus Stock $3.6 billion $35.35 $34.85 131,566 10/31/2017 1.42% 10.37%
+ FIG 02/14/2017 SoftBank Group Corp. (SFTBY) All Cash $3.3 billion $8.08 $7.97 556,827 12/31/2017 1.38% 4.54%
+ CBF 05/04/2017 First Horizon National Corp. (FHN) Cash Plus Stock $2.2 billion $36.68 $36.25 510,230 12/31/2017 1.18% 3.88%
+ MSFG 07/25/2017 First Financial Bancorp. (FFBC) All Stock $1 billion $32.40 $32.04 50,034 03/31/2018 1.12% 2.03%
+ MXPT 08/28/2017 Valassis (N/A) All Cash $101 million $13.86 $13.71 21,616 12/31/2017 1.09% 3.60%
+ RATE 07/03/2017 Red Ventures (N/A) All Cash $1.4 billion $14.00 $13.85 127,953 12/31/2017 1.08% 3.56%
+ CACQ 12/22/2014 Caesars Entertainment Corporation (CZR) All Stock N/A $18.69 $18.50 59,930 10/06/2017 1.01% 14.80%
+ CUNB 04/06/2017 PacWest Bancorp (PACW) Cash Plus Stock $705 million $35.20 $34.85 73,241 12/31/2017 1.01% 3.31%
+ WBKC 06/14/2017 Horizon Bancorp (HBNC) Cash Plus Stock $88.9 million $39.85 $39.45 4,058 10/31/2017 1.01% 7.35%
+ FSBK 06/12/2017 Carolina Financial Corporation (CARO) All Stock $162 million $17.00 $16.83 4,420 12/31/2017 1.00% 3.30%
+ KITE 08/28/2017 Gilead Sciences, Inc. (GILD) All Cash $11.9 billion $180.00 $178.23 3,796,814 12/31/2017 0.99% 3.27%
+ ATW 05/30/2017 Ensco plc (ESV) All Stock $1.7 billion $7.12 $7.05 3,451,412 09/30/2017 0.99% 19.07%
+ GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) All Cash $1.3 billion $5.10 $5.05 454,852 12/31/2017 0.99% 3.26%
+ CAB 10/03/2016 Bass Pro Shops (N/A) All Cash $5 billion $61.50 $60.93 1,833,252 09/30/2017 0.94% 17.97%
+ PMC 08/03/2017 KKR & Co. L.P. Unit (KKR) All Cash $1.39 billion $29.25 $29.00 435,093 05/01/2018 0.86% 1.36%
+ NMRX 08/02/2017 Sierra Wireless, Inc. (SWIR) All Stock $107 million $3.86 $3.83 13,360 12/31/2017 0.81% 2.66%
+ OKSB 12/14/2016 Simmons First National Corporation (SFNC) Cash Plus Stock $564.4 million $25.09 $24.90 43,249 09/30/2017 0.78% 14.92%
+ VTTI 05/08/2017 VTTI B.V. (N/A) All Cash $1.59 billion $19.50 $19.35 94,430 09/30/2017 0.78% 14.89%
+ BCR 04/23/2017 Becton, Dickinson and Company (BDX) Cash Plus Stock $24 billion $326.35 $323.91 530,470 11/30/2017 0.75% 3.43%
+ SNBC 06/30/2017 OceanFirst Financial Corp. (OCFC) Cash Plus Stock $640.73 million $23.01 $22.85 24,979 01/31/2018 0.70% 1.79%
+ MORE 07/05/2017 Greystar Growth and Income Fund (N/A) All Cash $3 billion $12.00 $11.92 1,754,041 12/31/2017 0.67% 2.21%
+ SHOR 07/27/2017 Mitel Networks Corporation (MITL) All Cash $430 million $7.50 $7.45 219,411 09/30/2017 0.67% 12.89%
+ NDRM 07/24/2017 Mitsubishi Tanabe Pharma Corporation (N/A) All Cash $654.33 million $39.00 $38.75 229,253 12/31/2017 0.65% 2.12%
+ OB 05/02/2017 Intact Financial Corporation (N/A) All Cash $1.7 billion $18.10 $17.99 139,686 12/31/2017 0.61% 2.01%
+ CDI 07/31/2017 affiliates of AE Industrial Partners, LLC (N/A) All Cash $168 million $8.25 $8.20 329,014 09/30/2017 0.61% 11.71%
+ PCBK 01/09/2017 Columbia Banking System, Inc. (COLB) All Stock $644.1 million $23.38 $23.25 61,543 09/30/2017 0.56% 10.70%
+ WSTC 05/09/2017 affiliates of certain funds managed by affiliates of Apollo Global Management, LLC (APO) All Cash $5.1 billion $23.50 $23.37 100,373 12/31/2017 0.56% 1.83%
+ VWR 05/05/2017 Avantor (N/A) All Cash $6.4 billion $33.25 $33.07 473,987 09/30/2017 0.54% 10.46%
+ PSTB 04/27/2017 South State Corporation (SSB) All Stock $690.8 million $11.17 $11.11 312,594 12/31/2017 0.50% 1.63%
+ DDC 07/17/2017 The Washington Companies (N/A) All Cash $1.06 billion $14.25 $14.18 952,401 12/31/2017 0.49% 1.62%
+ ASBB 05/01/2017 First Bancorp (FBNC) All Stock $175 million $43.91 $43.70 7,292 12/31/2017 0.47% 1.55%
+ IXYS 08/28/2017 Littelfuse, Inc. (LFUS) All Cash $655 million $23.00 $22.90 381,804 03/31/2018 0.44% 0.79%
+ PKY 06/30/2017 Canada Pension Plan Investment Board (N/A) All Cash $1.2 billion $23.05 $22.95 99,901 12/31/2017 0.44% 1.43%
+ MYCC 07/10/2017 Certain Investment Funds Affiliated with Apollo Global Management (N/A) All Cash $1.1 billion $17.12 $17.05 3,696,477 12/31/2017 0.41% 1.35%
+ LMOS 02/20/2017 EQT Infrastructure investment strategy (N/A) All Cash $950 million $18.00 $17.93 108,956 09/30/2017 0.39% 7.50%
+ PRXL 06/20/2017 Pamplona Capital Management, LLP (N/A) All Cash $5 billion $88.10 $87.77 985,305 10/31/2017 0.38% 2.74%
+ LVLT 10/31/2016 CenturyLink, Inc. (CTL) Cash Plus Stock $34 billion $52.99 $52.81 4,849,579 09/30/2017 0.33% 6.41%
+ STS 08/08/2017 Wabash National Corporation (WNC) All Cash $260.9 million $21.00 $20.94 122,311 12/31/2017 0.29% 0.94%
+ SFR 08/10/2017 Invitation Homes Inc. (INVH) All Stock $7.36 billion $36.04 $35.94 2,431,086 12/31/2017 0.28% 0.92%
+ FPO 06/28/2017 Government Properties Income Trust (GOV) All Cash $1.4 billion $11.15 $11.12 224,511 12/31/2017 0.27% 0.89%
+ DFT 06/09/2017 Digital Realty Trust, Inc. (DLR) All Stock $7.6 billion $65.74 $65.59 336,847 12/31/2017 0.23% 0.77%
+ WMAR 06/29/2017 a wholly owned affiliate of Monomoy Capital Partners (N/A) All Cash $258 million $12.97 $12.94 311,942 09/30/2017 0.23% 4.45%
+ HNH 06/26/2017 Steel Partners Holdings L.P. (SPLP-PA) All Stock $693.48 million $32.57 $32.50 6,517 12/31/2017 0.22% 0.72%
+ WNRL 08/14/2017 Andeavor Logistics LP (ANDX) All Stock $1.8 billion $25.75 $25.70 138,358 12/31/2017 0.18% 0.59%
+ GUID 07/26/2017 Open Text Corporation (OTEX) All Cash $161.94 million $7.10 $7.09 96,586 09/30/2017 0.14% 2.71%
+ SPLS 06/28/2017 Sycamore Partners (N/A) All Cash $6.9 billion $10.25 $10.24 9,667,207 12/31/2017 0.10% 0.32%
+ BSF 08/22/2017 Arvest Bank (N/A) All Cash $391 million $10.28 $10.27 63,051 03/31/2018 0.10% 0.18%
+ WBMD 07/24/2017 Internet Brands (N/A) All Cash $2.8 billion $66.50 $66.44 441,276 12/31/2017 0.09% 0.30%
+ WOOF 01/07/2017 Mars, Incorporated (N/A) All Cash $9.1 billion $93.00 $92.98 1,327,158 09/30/2017 0.02% 0.41%
+ SEV 07/17/2017 BorgWarner (N/A) All Cash $200 million $22.00 $22.00 9,301 12/31/2017 0.00% 0.00%
+ NEFF 08/16/2017 United Rentals, Inc. (URI) All Cash $838 million $25.00 $25.00 153,808 12/31/2017 0.00% 0.00%
+ RBPAA 01/30/2017 Bryn Mawr Bank Corporation (BMTC) All Stock $127.7 million $4.04 $4.04 3,463 09/30/2017 -0.04% -0.71%
+ ZPIN 04/06/2017 SEEK International Investments Pty Ltd. (N/A) All Cash $678.59 million $18.20 $18.18 25,403 12/31/2017 -0.17% -0.54%
+ AF 03/07/2017 Sterling Bancorp (STL) All Stock $2.2 billion $18.64 $18.68 760,802 12/31/2017 -0.23% -0.75%
+ FGL 05/24/2017 CF Corporation (CFCO) All Cash $1.835 billion $31.10 $31.20 72,344 12/31/2017 -0.32% -1.05%
+ HSNI 07/06/2017 Liberty Interactive Corporation (QVCA) All Stock $2.6 billion $37.42 $37.55 279,991 12/31/2017 -0.34% -1.12%
+ DGAS 02/21/2017 Peoples Natural Gas (N/A) All Cash $227 million $30.50 $30.62 5,097 12/31/2017 -0.39% -1.29%
+ PBNC 04/27/2017 TowneBank (TOWN) All Stock $323.7 million $51.66 $51.97 10,829 12/31/2017 -0.59% -1.94%
+ ARCX 08/29/2017 Zenith (N/A) All Cash $632.96 million $16.50 $16.62 108,287 01/31/2018 -0.72% -1.86%
+ LDR 09/06/2017 Fortive Corporation (FTV) All Cash $770 million $67.25 $68.10 198,511 12/31/2017 -1.25% -4.10%
+ WFBI 05/16/2017 Sandy Spring Bancorp, Inc. (SASR) All Stock $489 million $32.44 $32.86 11,021 12/31/2017 -1.28% -4.22%
+ NXPI 10/27/2016 QUALCOMM Incorporated (QCOM) All Cash $38 billion $110.00 $112.30 588,976 12/31/2017 -2.05% -6.73%
+ GNCMA 04/04/2017 Liberty Ventures (LVNTA) Special Conditions $2.68 billion $32.50 $42.41 128,198 12/31/2017 -23.37% -76.84%
+ ANGI 05/02/2017 IAC/InterActiveCorp (IAC) Special Conditions $331.67 million $8.50 $12.13 166,410 12/31/2017 -29.93% -98.40%

Disclaimer: I hold positions in Staples (SPLS), Cabela’s (CAB), Fortress Investment Group (FIG), MaxPoint Interactive (MXPT) and CombiMatrix (CBMX). 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

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