Merger Arbitrage Mondays – October 16, 2017
Merger activity was tepid last week with no new deals announced and six pending 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 2017 | 179 |
| Total Number of Deals Not Completed in 2017 | 10 |
| Total Number of Pending Deals |
| Cash Deals | 35 |
| Stock Deals | 18 |
| Stock & Cash Deals | 11 |
| Special Conditions | 8 |
| Total Number of Pending Deals | 72 |
| Total Deal Size | $918.14 billion |
New Deals:
With no new deals announced this week, I recommend checking out the article Time Is Money: Costly Deal Delays Put M&A Arbitrage Returns In The Spotlight by Malcolm Spink about an interesting approach to predicting closing dates and hence calculating annualized returns.
Deal Updates:
- On October 9, 2017, Genworth Financial (GNW) and China Oceanwide Holdings Group announced that the South Carolina Department of Insurance has approved the proposed acquisition of control by Oceanwide of Genworth’s South Carolina-domiciled special purpose financial captive insurance subsidiary, Rivermont Life Insurance Company I.
- On October 10, 2017, Qualcomm (QCOM) offered to buy NXP Semiconductors (NXPI) without some of its patents in a bid to win EU antitrust regulatory approval.
- On October 10, 2017, Parkway (PKY) announced that it has paid the previously announced special cash dividend of $4.00 per share of common stock to common stockholders of record as of the close of business on October 9, 2017. We have adjusted the deal price down to $19.05.
- On October 10, 2017, Columbia Banking System (COLB) and Pacific Continental Corporation (PCBK) jointly announced the receipt of the required regulatory approval from the Federal Reserve Board for their proposed merger. Columbia and Pacific Continental previously announced the receipt of the required approvals from the shareholders of both companies, the Federal Deposit Insurance Corporation and state regulators. Subject to customary closing conditions, the transaction is expected be completed on November 1, 2017.
- On October 13, 2017, Xcerra Stockholders (XCRA) approved the merger with an affiliate of Sino IC Capital and Unic Capital Management. The transaction is expected to close as soon as all regulatory approvals are received.
- On October 13, 2017, Bayer AG reached a 5.9 billion euro ($7 billion) deal to sell parts of its Crop Science unit to German chemical company BASF to alleviate regulatory concerns over its planned takeover of Monsanto (MON).
Closed Deals:
- The acquisition of Amec Foster Wheeler (AMFW) by John Wood Group (WG.L) on October 9, 2017. It took 210 days for this deal to be completed.
- The acquisition of West Corporation (WSTC) by affiliates of certain funds managed by affiliates of Apollo Global Management (APO) on October 10, 2017. It took 154 days for this deal to be completed.
- The acquisition of MaxPoint Interactive (MXPT) by Valassis on October 10, 2017. It took 43 days for this deal to be completed.
- The acquisition of Handy & Harman (HNH) by Steel Partners Holdings (SPLP-PA) on October 12, 2017. It took 108 days for this deal to be completed.
- The acquisition of Parkway (PKY) by Canada Pension Plan Investment Board on October 12, 2017. It took 104 days for this deal to be completed.
- The acquisition of SciClone Pharmaceuticals (SCLN) by 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 on October 13, 2017. It took 127 days for this deal to be completed.
Top 10 deals with largest spreads:
Closing
Price |
|---|
| GNW | 10/23/2016 | China Oceanwide Holdings Group Co., Ltd. (N/A) | $5.43 | $3.94 | 12/31/2017 | 37.82% | 181.62% |
| MGI | 01/26/2017 | Ant Financial Services Group (N/A) | $18.00 | $15.75 | 12/31/2017 | 14.29% | 68.61% |
| NXTM | 08/07/2017 | Fresenius Medical Care (N/A) | $30.00 | $27.59 | 06/30/2018 | 8.74% | 12.41% |
| SNI | 07/31/2017 | Discovery Communications, Inc. (DISCK) | $90.00 | $83.82 | 03/31/2018 | 7.37% | 16.21% |
| TWX | 10/22/2016 | AT&T, Inc. (T) | $107.50 | $100.94 | 12/31/2017 | 6.50% | 31.21% |
| CBMX | 07/31/2017 | Invitae Corporation (NVTA) | $8.33 | $7.85 | 12/31/2017 | 6.11% | 29.37% |
| BRCD | 11/02/2016 | Broadcom Limited (AVGO) | $12.75 | $12.04 | 11/30/2017 | 5.90% | 47.83% |
| HUN | 05/22/2017 | CLARIANT N (CLN.VX) | $30.84 | $29.32 | 12/31/2017 | 5.19% | 24.91% |
| YUME | 09/05/2017 | RhythmOne plc (RTHM.L) | $4.70 | $4.47 | 03/31/2018 | 5.09% | 11.19% |
| MON | 09/14/2016 | Bayer AG (BAYRY) | $128.00 | $122.30 | 01/31/2018 | 4.66% | 15.90% |
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 Fortress Investment Group (FIG) 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.
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