Merger Arbitrage Mondays – October 30, 2017

Merger activity increased last week with seven new deals announced and two 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 three new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017 184
Total Number of Deals Not Completed in 2017 11
Total Number of Pending Deals
Cash Deals 40
Stock Deals 18
Stock & Cash Deals 8
Special Conditions 9
Total Number of Pending Deals 75
Total Deal Size $918.46 billion

New Deals:

  1. The acquisition of BroadSoft (BSFT) by Cisco (CSCO) for $1.9 billion or $55.00 per share in cash.
  2. The acquisition of Deltic Timber Corporation (DEL) by Potlatch Corporation (PCH) for $1.18 billion in an all stock deal. Under the terms of the agreement, Deltic stockholders will receive 1.80 common shares of Potlatch stock for each common share of Deltic that they own.
  3. The acquisition of Exactech (EXAC) by TPG Capital for $625 million or $42.00 per share in cash.
  4. The acquisition of Inventure Foods (SNAK) by Utz Quality Foods for $165 million or $4.00 per share in cash.
  5. The acquisition of Gigamon (GIMO) by Elliott Management for $1.6 billion or $38.50 per share in cash.
  6. The acquisition of Planet Payment (PLPM) by Fintrax Group for $184.93 million or $4.50 per share in cash.
  7. The acquisition of Enzymotec (ENZY) by Frutarom for $156.88 million or $11.90 per share in cash.

Deal Updates:

  1. On October 23, 2017, Brazil’s antitrust authority, the Conselho Administrativo de Defesa Econômica (CADE) approved AT&T’s (T) pending acquisition of Time Warner (TWX). With CADE’s approval, AT&T and Time Warner have received all required merger approvals outside of the United States.  In the United States, the transaction remains under review by the U.S. Department of Justice.  AT&T expects the transaction to close by the end of 2017.
  2. On October 24, 2017, Bank Mutual Corporation (BKMU) announced that its shareholders voted to approve the previously announced merger agreement providing for the merger of Bank Mutual with Associated Banc-Corp (ASB). The merger transaction remains subject to regulatory approvals and customary closing conditions; the companies expect the transaction will close in early 2018.
  3. On October 26, 2017, Bayer cut the value of its takeover of Monsanto (MON) by $2.5 billion (£1.89 billion), which combined with windfalls from asset sales means it may have to raise less than expected from shareholders. The Monsanto deal is now valued at $63.5 billion including debt, down from an initial $66 billion, because the U.S. seeds giant had lowered its financial liabilities.
  4. On October 26, 2017, seven groups from across the political spectrum joined together to urge the Justice Department to reject AT&T’s (T) $85B bid for Time Warner (TWX), objecting to the power over television that the combined company would have.
  5. On October 26, 2017, At separate special meetings, shareholders of both Union Bankshares Corporation (UBSH) and Xenith Bankshares (XBKSapproved the merger of Xenith with and into Union. All regulatory approvals have been received and the merger is expected to close during early January 2018.
  6. On October 26, 2017, Ultragenyx Pharmaceutical (RARE) and Dimension Therapeutics (DMTX)  announced that the required waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 with respect to Ultragenyx’s proposed acquisition of Dimension expired on October 25, 2017. The tender offer is scheduled to expire on November 7, 2017.
  7. On October 27, 2017, Huntsman Corporation (HUN) and Clariant (CLN.VX) today jointly announced that they have terminated their proposed merger of equals by mutual agreement after facing pressure from U.S. activist investors who wanted to block the deal. The decision was unanimously approved by the Boards of Directors of Huntsman and Clariant.
  8. On October 27, 2017, NxStage Medical (NXTM) announced that at a special meeting of stockholders, the Company’s stockholders voted to adopt the previously announced Agreement and Plan of Merger with Fresenius Medical Care Holdings.
  9. On October 27, 2017, Carolina Financial Corporation (CARO) and First South Bancorp (FSBK) announced that they have received all required regulatory approvals and the approval of each company’s stockholders to proceed with the merger of First South with and into Carolina Financial. The closing of the mergers of Carolina Financial and First South and their subsidiary banks are expected to occur on November 1, 2017.
  10. On October 27, 2017, Dominion Diamond Corporation (DDC) announced that The Washington Companies has received Investment Canada Act approval in connection with the previously-announced plan of arrangement, pursuant to which Northwest Acquisitions, has agreed to acquire all of the issued and outstanding common shares of the Company. The Arrangement has previously received shareholder approval, court approval, and clearance under the Competition Act (Canada). No further regulatory or shareholder approvals are required in connection with the Arrangement. The Arrangement is expected to be completed on or about November 1, 2017, subject to the satisfaction or waiver of the remaining conditions of closing.

Closed Deals:

  1. The acquisition of NeuroDerm (NDRM) by Mitsubishi Tanabe Pharma Corporation on October 18, 2017. It took 86 days for this deal to be completed.
  2. The acquisition of CU Bancorp (CUNB) by PacWest Bancorp (PACW) on October 23, 2017. It took 200 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 $3.40 12/31/2017 59.71% 351.49%
MGI 01/26/2017 Ant Financial Services Group (N/A) $18.00 $15.80 12/31/2017 13.92% 81.97%
NXTM 08/07/2017 Fresenius Medical Care (N/A) $30.00 $27.05 06/30/2018 10.91% 16.38%
BRCD 11/02/2016 Broadcom Limited (AVGO) $12.75 $11.64 12/15/2017 9.54% 75.67%
CBMX 07/31/2017 Invitae Corporation (NVTA) $8.33 $7.65 12/31/2017 8.89% 52.33%
TWX 10/22/2016 AT&T, Inc. (T) $107.50 $98.79 12/31/2017 8.82% 51.90%
SNI 07/31/2017 Discovery Communications, Inc. (DISCK) $90.00 $83.41 03/31/2018 7.90% 18.97%
YUME 09/05/2017 RhythmOne plc (RTHM.L) $4.35 $4.06 03/31/2018 7.05% 16.93%
ENZY 10/29/2017 Frutarom (N/A) $11.90 $11.25 03/31/2018 5.78% 13.87%
MON 09/14/2016 Bayer AG (BAYRY) $128.00 $121.52 01/31/2018 5.33% 20.93%

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 $3.40 3,513,131 12/31/2017 59.71% 351.49%
+ MGI 01/26/2017 Ant Financial Services Group (N/A) All Cash $1.2 billion $18.00 $15.80 440,662 12/31/2017 13.92% 81.97%
+ NXTM 08/07/2017 Fresenius Medical Care (N/A) All Cash $1.62 billion $30.00 $27.05 564,214 06/30/2018 10.91% 16.38%
+ BRCD 11/02/2016 Broadcom Limited (AVGO) All Cash $5.5 billion $12.75 $11.64 6,015,942 12/15/2017 9.54% 75.67%
+ CBMX 07/31/2017 Invitae Corporation (NVTA) Special Conditions $20.22 million $8.33 $7.65 50,048 12/31/2017 8.89% 52.33%
+ TWX 10/22/2016 AT&T, Inc. (T) Special Conditions $108.7 billion $107.50 $98.79 9,882,265 12/31/2017 8.82% 51.90%
+ SNI 07/31/2017 Discovery Communications, Inc. (DISCK) Special Conditions $14.6 billion $90.00 $83.41 505,859 03/31/2018 7.90% 18.97%
+ YUME 09/05/2017 RhythmOne plc (RTHM.L) Cash Plus Stock $102.36 million $4.35 $4.06 92,393 03/31/2018 7.05% 16.93%
+ ENZY 10/29/2017 Frutarom (N/A) All Cash $156.88 million $11.90 $11.25 31,428 03/31/2018 5.78% 13.87%
+ MON 09/14/2016 Bayer AG (BAYRY) All Cash $63.5 billion $128.00 $121.52 1,809,627 01/31/2018 5.33% 20.93%
+ AKRX 04/24/2017 Fresenius Kabi (N/A) All Cash $4.75 billion $34.00 $32.52 2,629,030 03/31/2018 4.55% 10.93%
+ GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) All Cash $1.3 billion $5.10 $4.90 138,121 12/31/2017 4.08% 24.03%
+ HCOM 07/10/2017 Cincinnati Bell (CBB) Cash Plus Stock $650 million $31.14 $29.98 16,800 12/31/2018 3.85% 3.29%
+ ANCB 04/11/2017 Washington Federal, Inc. (WAFD) Special Conditions $63.9 million $25.75 $24.80 1,440 06/30/2018 3.83% 5.75%
+ XCRA 04/10/2017 an affiliate of Sino IC Capital and Unic Capital Management (N/A) All Cash $439.97 million $10.25 $9.89 573,083 12/31/2017 3.64% 21.43%
+ COL 09/04/2017 United Technologies Corp. (UTX) Special Conditions $30 billion $140.00 $135.30 990,436 09/30/2018 3.47% 3.78%
+ FIG 02/14/2017 SoftBank Group Corp. (SFTBY) All Cash $3.3 billion $8.08 $7.81 2,276,189 12/31/2017 3.46% 20.35%
+ TRCO 05/08/2017 Sinclair Broadcast Group, Inc. (SBGI) Cash Plus Stock $6.6 billion $42.13 $40.78 404,894 12/31/2017 3.31% 19.49%
+ FSBK 06/12/2017 Carolina Financial Corporation (CARO) All Stock $162 million $20.45 $19.92 814,943 11/01/2017 2.67% 487.03%
+ WGL 01/25/2017 AltaGas Ltd. (N/A) All Cash $6.4 billion $88.25 $85.97 224,775 06/30/2018 2.65% 3.98%
+ CPN 08/18/2017 Energy Capital Partners (N/A) All Cash $17.3 billion $15.25 $14.91 3,045,733 03/31/2018 2.28% 5.48%
+ RBPAA 01/30/2017 Bryn Mawr Bank Corporation (BMTC) All Stock $127.7 million $4.57 $4.47 7,463 12/31/2017 2.16% 12.69%
+ BYBK 09/27/2017 Old Line Bancshares, Inc. (OLBK) All Stock $128.6 million $12.24 $12.05 6,288 06/30/2018 1.59% 2.40%
+ STRP 05/11/2017 Verizon Communications Inc. (VZ) Special Conditions $3.1 billion $184.00 $181.22 87,498 03/15/2018 1.53% 4.12%
+ PBNC 04/27/2017 TowneBank (TOWN) All Stock $323.7 million $60.20 $59.30 11,245 12/31/2017 1.52% 8.96%
+ SNBC 06/30/2017 OceanFirst Financial Corp. (OCFC) Cash Plus Stock $640.73 million $26.74 $26.35 50,166 01/31/2018 1.47% 5.78%
+ AVA 07/19/2017 Hydro One Limited (N/A) All Cash $5.3 billion $53.00 $52.34 377,129 12/31/2018 1.26% 1.08%
+ WFBI 05/16/2017 Sandy Spring Bancorp, Inc. (SASR) All Stock $489 million $36.10 $35.69 8,633 12/31/2017 1.14% 6.73%
+ NEWS 10/17/2017 First Eagle Investment Management (N/A) Special Conditions $3.4 billion $12.44 $12.31 86,613 12/31/2017 1.06% 6.22%
+ RIC 09/11/2017 Alamos Gold Inc. (AGI) All Stock $455.53 million $8.74 $8.65 241,368 11/15/2017 1.03% 23.56%
+ SPA 07/07/2017 Ultra Electronics Holdings (N/A) All Cash $308.13 million $23.50 $23.27 146,235 01/08/2018 0.99% 5.15%
+ CBF 05/04/2017 First Horizon National Corp. (FHN) Cash Plus Stock $2.2 billion $41.69 $41.30 338,862 12/31/2017 0.95% 5.56%
+ DEL 10/23/2017 Potlatch Corporation (PCH) All Stock $1.18 billion $93.24 $92.37 360,942 06/30/2018 0.94% 1.41%
+ SBCP 08/14/2017 CenterState Banks, Inc. (CSFL) All Stock $176.7 million $24.51 $24.29 12,294 03/31/2018 0.91% 2.18%
+ OA 09/18/2017 Northrop Grumman Corporation (NOC) All Cash $9.2 billion $134.50 $133.30 348,870 06/30/2018 0.90% 1.35%
+ RT 10/16/2017 NRD Capital (N/A) All Cash $335 million $2.40 $2.38 568,319 03/31/2018 0.84% 2.02%
+ SSNI 09/18/2017 Itron, Inc. (ITRI) All Cash $712 million $16.25 $16.12 1,119,485 03/31/2018 0.81% 1.94%
+ BKMU 07/20/2017 Associated Banc-Corp (ASB) All Stock $482 million $10.78 $10.70 89,811 03/31/2018 0.77% 1.84%
+ RICE 06/19/2017 EQT Corporation (EQT) Cash Plus Stock $8.2 billion $28.72 $28.51 24,335,362 12/31/2017 0.75% 4.43%
+ XBKS 05/22/2017 Union Bankshares Corporation (UBSH) All Stock $701.2 million $32.88 $32.64 8,439 01/15/2018 0.73% 3.48%
+ ABCO 08/29/2017 Optum and Vista Equity Partners (N/A) Special Conditions $2.66 billion $54.29 $53.90 535,465 03/31/2018 0.72% 1.74%
+ PLPM 10/26/2017 Fintrax Group (N/A) All Cash $184.93 million $4.50 $4.47 23,845,113 12/31/2017 0.67% 3.95%
+ TESO 08/14/2017 Nabors Industries Ltd. (NBR) All Stock $157.23 million $3.77 $3.75 346,879 12/31/2017 0.64% 3.77%
+ DDC 07/17/2017 The Washington Companies (N/A) All Cash $1.06 billion $14.25 $14.16 606,111 11/01/2017 0.64% 116.00%
+ PMC 08/03/2017 KKR & Co. L.P. Unit (KKR) All Cash $1.39 billion $29.25 $29.10 187,485 05/01/2018 0.52% 1.03%
+ MSFG 07/25/2017 First Financial Bancorp. (FFBC) All Stock $1 billion $38.92 $38.73 53,625 03/31/2018 0.49% 1.17%
+ BCR 04/23/2017 Becton, Dickinson and Company (BDX) Cash Plus Stock $24 billion $329.60 $328.09 399,515 11/30/2017 0.46% 5.41%
+ OME 10/06/2017 Cooke Inc. (N/A) All Cash $520.88 $22.00 $21.90 411,756 01/31/2018 0.46% 1.79%
+ VWR 05/05/2017 Avantor (N/A) All Cash $6.4 billion $33.25 $33.10 453,455 12/31/2017 0.45% 2.67%
+ PSTB 04/27/2017 South State Corporation (SSB) All Stock $690.8 million $12.94 $12.89 120,352 12/31/2017 0.41% 2.42%
+ RATE 07/03/2017 Red Ventures (N/A) All Cash $1.4 billion $14.00 $13.95 118,476 12/31/2017 0.36% 2.11%
+ EXAC 10/23/2017 TPG Capital (N/A) All Cash $625 million $42.00 $41.85 457,755 03/31/2018 0.36% 0.86%
+ PCBK 01/09/2017 Columbia Banking System, Inc. (COLB) All Stock $644.1 million $28.35 $28.25 141,018 11/01/2017 0.35% 64.52%
+ LMOS 02/20/2017 EQT Infrastructure investment strategy (N/A) All Cash $950 million $18.00 $17.94 124,485 11/07/2017 0.33% 15.26%
+ LVLT 10/31/2016 CenturyLink, Inc. (CTL) Cash Plus Stock $34 billion $51.47 $51.31 4,967,361 10/31/2017 0.32% 115.19%
+ SNAK 10/26/2017 Utz Quality Foods, LLC (N/A) All Cash $165 million $4.00 $3.99 1,051,872 12/31/2017 0.25% 1.48%
+ SFR 08/10/2017 Invitation Homes Inc. (INVH) All Stock $7.36 billion $37.06 $36.97 808,419 12/31/2017 0.24% 1.39%
+ EXA 09/28/2017 Dassault Syst�mes (N/A) All Cash $400 million $24.25 $24.20 248,403 12/31/2017 0.21% 1.22%
+ BSFT 10/23/2017 Cisco (CSCO) All Cash $1.9 billion $55.00 $54.90 1,706,389 03/31/2018 0.18% 0.44%
+ NMRX 08/02/2017 Sierra Wireless, Inc. (SWIR) All Stock $107 million $4.00 $3.99 40,336 12/31/2017 0.15% 0.89%
+ BSF 08/22/2017 Arvest Bank (N/A) All Cash $391 million $10.28 $10.27 26,441 03/31/2018 0.10% 0.23%
+ CCC 09/21/2017 Kuraray (N/A) All Cash $1.3 billion $21.50 $21.50 792,559 12/31/2017 0.00% 0.00%
+ ONVI 10/05/2017 Project Diamond Intermediate Holdings and Deltek (N/A) All Cash $70 million $9.00 $9.00 450 12/31/2017 0.00% 0.00%
+ DMTX 10/03/2017 Ultragenyx Pharmaceutical Inc. (RARE) All Cash $151 million $6.00 $6.00 28,274 12/31/2017 0.00% 0.00%
+ SNC 07/26/2017 Markel Corporation (MKL) All Cash $919 million $21.00 $21.01 57,663 12/31/2017 -0.05% -0.28%
+ BOBE 09/19/2017 Post Holdings, Inc. (POST) All Cash $1.53 billion $77.00 $77.19 462,727 03/31/2018 -0.25% -0.59%
+ WNRL 08/14/2017 Andeavor Logistics LP (ANDX) All Stock $1.8 billion $24.24 $24.30 719,606 12/31/2017 -0.25% -1.47%
+ SVA 06/26/2017 Sinovac Limited and Sinovac Amalgamation Sub Limited (N/A) All Cash $437.59 million $7.00 $7.02 174,023 12/31/2017 -0.28% -1.68%
+ FGL 05/24/2017 CF Corporation (CFCO) All Cash $1.835 billion $31.10 $31.20 192,074 12/31/2017 -0.32% -1.89%
+ HSNI 07/06/2017 Liberty Interactive Corporation (QVCA) All Stock $2.6 billion $37.46 $37.60 260,960 12/31/2017 -0.39% -2.27%
+ ARCX 08/29/2017 Zenith (N/A) All Cash $632.96 million $16.50 $16.57 187,929 01/31/2018 -0.42% -1.66%
+ GIMO 10/26/2017 Elliott Management (N/A) All Cash $1.6 billion $38.50 $38.70 11,850,131 03/31/2018 -0.52% -1.24%
+ NXPI 10/27/2016 QUALCOMM Incorporated (QCOM) All Cash $38 billion $110.00 $116.93 3,068,601 12/31/2017 -5.93% -34.89%
+ IXYS 08/28/2017 Littelfuse, Inc. (LFUS) All Cash $655 million $23.00 $24.70 193,330 03/31/2018 -6.88% -16.53%
+ GNCMA 04/04/2017 Liberty Ventures (LVNTA) Special Conditions $2.68 billion $32.50 $39.57 94,175 12/31/2017 -17.87% -105.19%

Disclaimer: I hold positions in Fortress Investment Group (FIG), CombiMatrix (CBMX) and Brocade Communication Systems (BRCD). 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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