Merger Arbitrage Mondays – December 4, 2017

Merger activity increased last week with six new deals announced and three 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 205
Total Number of Deals Not Completed in 2017 11
Total Number of Pending Deals
Cash Deals 39
Stock Deals 19
Stock & Cash Deals 8
Collars 1
Special Conditions 8
Total Number of Pending Deals 74
Total Deal Size $1043.04 billion

New Deals:

  1. The acquisition of Barracuda Networks (CUDA) by Thoma Bravo for $1.29 billion or $27.55 per share in cash.
  2. The acquisition of MGC Diagnostics Corporation (MGCD) by affiliates of Altus Capital Partners for $52.63 million or $11.03 per share in cash.
  3. The acquisition of Bazaarvoice (BV) by entities affiliated with the global investment firm, Marlin Equity Partners for $398.69 million or $5.50 per share in cash.
  4. The acquisition of Buffalo Wild Wings (BWLD) by Arby’s Restaurant Group for $2.9 billion or $157 per share in cash. We added this “potential” deal to our Deals in the Works tool on November 13, 2017.
  5. The acquisition of Aetna (AET) by CVS Health (CVS) for $77 billion or $207 per share in a cash plus stock deal. We added this “potential” deal to our Deals in the Works tool on November 30, 2017.
  6. The acquisition of General Cable Corporation (BGC) by Prysmian Group for $3 billion or $30.00 per share in cash.

Deal Updates:

  1. On November 28, 2017, AT&T (T) and Time Warner (TWX) argued that their proposed $85.4 billion  merger was “pro-competitive” and “pro-consumer”, as they sought to refute U.S. Justice Department allegations that the deal breaks antitrust law. The two companies have reportedly extended the deadline of their proposed merger to Apr 22, 2018. The duration of the deal was extended in order to gain the remaining regulatory approvals required to close the merger.
  2. On November 29, 2017, Orbital ATK (OA) announced that its stockholders overwhelmingly approved the merger agreement providing for the proposed acquisition of Orbital ATK by Northrop Grumman Corporation (NOC).
  3. On November 29, 2017, Genworth Financial (GNW) and China Oceanwide Holdings Group announced that they have agreed to a second waiver and agreement of each party’s right to terminate the previously announced merger agreement. The second waiver and agreement extends the previous deadline of Nov. 30, 2017, to April 1, 2018, and allows additional time for regulatory reviews of the transaction.
  4. On December 1, 2017, Bayer and Monsanto (MON) announced that the Committee on Foreign Investment in the United States (“CFIUS”) has completed its review of the proposed merger, and has concluded that there are no unresolved national security concerns with respect to the transaction.
  5. On December 1, 2017, At a special Meeting of Shareholders, Tesco (TESOshareholders approved, by a large majority, the Arrangement pursuant to which Nabors (NBR) will acquire all of Tesco’s common shares in a stock-for-stock transaction.

Closed Deals:

  1. The acquisition of Fidelity & Guaranty Life (FGL) by CF Corporation (CFCO) on November 30, 2017. It took 190 days for this deal to be completed.
  2. The acquisition of Park Sterling Corporation (PSTB) by South State Corporation (SSB) on December 1, 2017. It took 219 days for this deal to be completed.
  3. The acquisition of Capital Bank Financial (CBF) by First Horizon National (FHN) on December 1, 2017. It took 211 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 $3.41 04/01/2018 59.24% 183.23%
BGC 12/04/2017 Prysmian Group (N/A) $30.00 $21.80 09/30/2018 37.61% 45.76%
BCEI 11/15/2017 SandRidge Energy (SD) $36.00 $27.99 03/31/2018 28.62% 89.28%
MGI 01/26/2017 Ant Financial Services Group (N/A) $18.00 $14.17 12/31/2017 27.03% 365.39%
NXTM 08/07/2017 Fresenius Medical Care (N/A) $30.00 $25.35 06/30/2018 18.34% 32.19%
TWX 10/22/2016 AT&T, Inc. (T) $106.20 $91.30 04/22/2018 16.32% 42.86%
SXE 11/01/2017 American Midstream Partners, LP (AMID) $1.95 $1.70 06/30/2018 14.82% 26.01%
AET 12/03/2017 CVS Health (CVS) $207.94 $181.31 12/31/2018 14.69% 13.67%
YUME 09/05/2017 RhythmOne plc (RTHM.L) $4.11 $3.61 03/31/2018 13.93% 43.44%
GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) $5.10 $4.65 12/31/2017 9.68% 130.82%

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 $3.41 1,951,404 04/01/2018 59.24% 183.23%
+ BGC 12/04/2017 Prysmian Group (N/A) All Cash $3 billion $30.00 $21.80 1,998,752 09/30/2018 37.61% 45.76%
+ BCEI 11/15/2017 SandRidge Energy (SD) Special Conditions $746 million $36.00 $27.99 249,463 03/31/2018 28.62% 89.28%
+ MGI 01/26/2017 Ant Financial Services Group (N/A) All Cash $1.2 billion $18.00 $14.17 304,631 12/31/2017 27.03% 365.39%
+ NXTM 08/07/2017 Fresenius Medical Care (N/A) All Cash $1.62 billion $30.00 $25.35 2,141,113 06/30/2018 18.34% 32.19%
+ TWX 10/22/2016 AT&T, Inc. (T) Collars $108.7 billion $106.20 $91.30 4,291,161 04/22/2018 16.32% 42.86%
+ SXE 11/01/2017 American Midstream Partners, LP (AMID) All Stock $815 million $1.95 $1.70 69,067 06/30/2018 14.82% 26.01%
+ AET 12/03/2017 CVS Health (CVS) Cash Plus Stock $77 billion $207.94 $181.31 3,881,291 12/31/2018 14.69% 13.67%
+ YUME 09/05/2017 RhythmOne plc (RTHM.L) Cash Plus Stock $102.36 million $4.11 $3.61 128,937 03/31/2018 13.93% 43.44%
+ GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) All Cash $1.3 billion $5.10 $4.65 556,581 12/31/2017 9.68% 130.82%
+ SNI 07/31/2017 Discovery Communications, Inc. (DISCK) Special Conditions $14.6 billion $90.00 $82.30 709,074 03/31/2018 9.36% 29.19%
+ MON 09/14/2016 Bayer AG (BAYRY) All Cash $63.5 billion $128.00 $118.93 3,812,520 03/31/2018 7.63% 23.79%
+ COL 09/04/2017 United Technologies Corp. (UTX) Special Conditions $30 billion $140.00 $132.90 1,205,483 09/30/2018 5.34% 6.50%
+ CALL 11/09/2017 B. Riley Financial, Inc. (RILY) All Cash $143 million $8.71 $8.30 127,632 06/30/2018 4.94% 8.67%
+ NEWS 10/17/2017 First Eagle Investment Management (N/A) Special Conditions $3.4 billion $12.44 $11.90 256,308 12/31/2017 4.54% 61.34%
+ TRCO 05/08/2017 Sinclair Broadcast Group, Inc. (SBGI) Cash Plus Stock $6.6 billion $42.80 $41.15 1,215,320 12/31/2017 4.00% 54.11%
+ JASO 11/17/2017 JASO Holdings Limited, JASO Parent Limited and JASO Acquisition Limited (N/A) All Cash $677.43 $7.55 $7.27 973,712 03/31/2018 3.85% 12.02%
+ WGL 01/25/2017 AltaGas Ltd. (N/A) All Cash $6.4 billion $88.25 $84.99 703,917 06/30/2018 3.84% 6.73%
+ ANCB 04/11/2017 Washington Federal, Inc. (WAFD) Special Conditions $63.9 million $25.75 $24.9000 561 06/30/2018 3.41% 5.99%
+ XCRA 04/10/2017 an affiliate of Sino IC Capital and Unic Capital Management (N/A) All Cash $439.97 million $10.25 $9.915 215,654 12/31/2017 3.38% 45.68%
+ HCOM 07/10/2017 Cincinnati Bell (CBB) Cash Plus Stock $650 million $32.44 $31.39 14,063 12/31/2018 3.34% 3.11%
+ AKRX 04/24/2017 Fresenius Kabi (N/A) All Cash $4.75 billion $34.00 $32.90 1,477,603 03/31/2018 3.34% 10.43%
+ CAVM 11/20/2017 Marvell Technology Group Ltd. (MRVL) Cash Plus Stock $6 billion $88.26 $85.41 2,019,865 06/30/2018 3.33% 5.85%
+ FIG 02/14/2017 SoftBank Group Corp. (SFTBY) All Cash $3.3 billion $8.08 $7.85 2,158,164 12/31/2017 2.93% 39.61%
+ ACFC 11/17/2017 Ameris Bancorp (ABCB) Cash Plus Stock $145 million $9.85 $9.62 107,271 06/30/2018 2.36% 4.15%
+ DYN 10/30/2017 Vistra Energy Corp. (VST) All Stock $12.3 billion $12.21 $11.93 6,633,495 06/30/2018 2.36% 4.15%
+ CSBK 11/02/2017 Kearny Financial Corp. (KRNY) All Stock $408 million $17.51 $17.15 200,456 04/15/2018 2.09% 5.77%
+ AVA 07/19/2017 Hydro One Limited (N/A) All Cash $5.3 billion $53.00 $51.94 363,606 12/31/2018 2.04% 1.90%
+ BYBK 09/27/2017 Old Line Bancshares, Inc. (OLBK) All Stock $128.6 million $12.24 $12.00 3,003 06/30/2018 1.98% 3.48%
+ RBPAA 01/30/2017 Bryn Mawr Bank Corporation (BMTC) All Stock $127.7 million $4.54 $4.46 17,029 12/31/2017 1.81% 24.48%
+ OA 09/18/2017 Northrop Grumman Corporation (NOC) All Cash $9.2 billion $134.50 $132.28 596,501 06/30/2018 1.68% 2.95%
+ CPLA 10/30/2017 Strayer Education, Inc. (STRA) All Stock $820.96 million $85.65 $84.40 98,870 09/30/2018 1.48% 1.79%
+ CPN 08/18/2017 Energy Capital Partners (N/A) All Cash $17.3 billion $15.25 $15.03 3,123,164 03/31/2018 1.46% 4.57%
+ SPA 07/07/2017 Ultra Electronics Holdings (N/A) All Cash $308.13 million $23.50 $23.23 89,817 01/08/2018 1.16% 12.12%
+ SSNI 09/18/2017 Itron, Inc. (ITRI) All Cash $712 million $16.25 $16.08 714,183 03/31/2018 1.06% 3.30%
+ SBCP 08/14/2017 CenterState Banks, Inc. (CSFL) All Stock $176.7 million $24.19 $23.94 10,070 03/31/2018 1.05% 3.26%
+ AFAM 11/16/2017 LHC Group, Inc. (LHCG) All Stock $1.06 billion $59.87 $59.25 237,012 06/30/2018 1.04% 1.83%
+ STRP 05/11/2017 Verizon Communications Inc. (VZ) Special Conditions $3.1 billion $184.00 $182.22 55,061 03/15/2018 0.98% 3.53%
+ BWLD 11/28/2017 Arby�s Restaurant Group, Inc. (N/A) All Cash $2.9 billion $157.00 $155.50 3,137,965 03/31/2018 0.96% 3.01%
+ PBNC 04/27/2017 TowneBank (TOWN) All Stock $323.7 million $57.79 $57.26 6,660 12/31/2017 0.92% 12.45%
+ AAAP 10/30/2017 Novartis AG (NVS) All Cash $3.9 billion $82.00 $81.34 691,402 03/31/2018 0.81% 2.53%
+ BKMU 07/20/2017 Associated Banc-Corp (ASB) All Stock $482 million $10.78 $10.70 102,941 03/31/2018 0.77% 2.39%
+ SNBC 06/30/2017 OceanFirst Financial Corp. (OCFC) Cash Plus Stock $640.73 million $25.82 $25.65 21,527 01/31/2018 0.65% 4.07%
+ ENZY 10/29/2017 Frutarom (N/A) All Cash $156.88 million $11.90 $11.825 53,819 03/31/2018 0.63% 1.98%
+ ALDW 11/08/2017 Delek US Holdings, Inc. (DK) All Stock $778.02 million $15.93 $15.83 287,568 03/31/2018 0.60% 1.87%
+ TESO 08/14/2017 Nabors Industries Ltd. (NBR) All Stock $157.23 million $4.32 $4.30 499,194 12/31/2017 0.58% 7.80%
+ NMRX 08/02/2017 Sierra Wireless, Inc. (SWIR) All Stock $107 million $3.95 $3.93 27,578 12/31/2017 0.53% 7.22%
+ BCR 04/23/2017 Becton, Dickinson and Company (BDX) Cash Plus Stock $24 billion $337.84 $336.06 517,634 11/30/2017 0.53% 0.00%
+ DEL 10/23/2017 Potlatch Corporation (PCH) All Stock $1.18 billion $93.06 $92.60 331,188 06/30/2018 0.50% 0.87%
+ BV 11/27/2017 entities affiliated with the global investment firm, Marlin Equity Partners (N/A) All Cash $398.69 million $5.50 $5.475 2,275,218 03/31/2018 0.46% 1.42%
+ MGCD 11/27/2017 affiliates of Altus Capital Partners, Inc. (N/A) All Cash $52.63 million $11.03 $10.98 34,170 03/31/2018 0.46% 1.42%
+ BSFT 10/23/2017 Cisco (CSCO) All Cash $1.9 billion $55.00 $54.80 1,357,775 03/31/2018 0.36% 1.14%
+ ARCX 08/29/2017 Zenith (N/A) All Cash $632.96 million $16.50 $16.45 71,187 01/31/2018 0.30% 1.91%
+ CCC 09/21/2017 Kuraray (N/A) All Cash $1.3 billion $21.50 $21.45 1,053,582 12/31/2017 0.23% 3.15%
+ PLPM 10/26/2017 Fintrax Group (N/A) All Cash $184.93 million $4.50 $4.49 326,048 12/31/2017 0.22% 3.01%
+ BSF 08/22/2017 Arvest Bank (N/A) All Cash $391 million $10.28 $10.26 56,723 03/31/2018 0.19% 0.61%
+ CUDA 11/27/2017 Thoma Bravo, LLC (N/A) All Cash $1.29 billion $27.55 $27.51 1,775,993 02/28/2018 0.15% 0.62%
+ WFBI 05/16/2017 Sandy Spring Bancorp, Inc. (SASR) All Stock $489 million $34.27 $34.26 23,020 01/01/2018 0.02% 0.31%
+ XBKS 05/22/2017 Union Bankshares Corporation (UBSH) All Stock $701.2 million $35.40 $35.40 32,601 01/15/2018 0.01% 0.12%
+ OME 10/06/2017 Cooke Inc. (N/A) All Cash $520.88 $22.00 $22.00 305,301 01/31/2018 0.00% 0.00%
+ RT 10/16/2017 NRD Capital (N/A) All Cash $335 million $2.40 $2.40 1,421,776 03/31/2018 0.00% 0.00%
+ SNAK 10/26/2017 Utz Quality Foods, LLC (N/A) All Cash $165 million $4.00 $4.00 103,970 12/31/2017 0.00% 0.00%
+ PMC 08/03/2017 KKR & Co. L.P. Unit (KKR) All Cash $1.39 billion $29.25 $29.25 147,684 05/01/2018 0.00% 0.00%
+ BOBE 09/19/2017 Post Holdings, Inc. (POST) All Cash $1.53 billion $77.00 $77.34 175,070 03/31/2018 -0.44% -1.37%
+ TIME 11/26/2017 Meredith Corporation (MDP) All Cash $2.8 billion $18.50 $18.60 2,380,902 03/31/2018 -0.54% -1.68%
+ CAA 10/30/2017 Lennar Corporation (LEN) All Stock $9.3 billion $55.37 $55.68 1,862,905 03/31/2018 -0.56% -1.76%
+ MSFG 07/25/2017 First Financial Bancorp. (FFBC) All Stock $1 billion $39.27 $39.50 72,661 03/31/2018 -0.59% -1.85%
+ HSNI 07/06/2017 Liberty Interactive Corporation (QVCA) All Stock $2.6 billion $40.79 $41.05 234,378 12/31/2017 -0.64% -8.63%
+ GIMO 10/26/2017 Elliott Management (N/A) All Cash $1.6 billion $38.50 $38.75 695,270 03/31/2018 -0.65% -2.01%
+ EXAC 10/23/2017 TPG Capital (N/A) All Cash $625 million $42.00 $42.35 170,384 03/31/2018 -0.83% -2.58%
+ NXPI 10/27/2016 QUALCOMM Incorporated (QCOM) All Cash $38 billion $110.00 $114.78 4,859,430 12/31/2017 -4.16% -56.30%
+ IXYS 08/28/2017 Littelfuse, Inc. (LFUS) All Cash $655 million $23.00 $24.20 233,639 03/31/2018 -4.96% -15.47%
+ SVA 06/26/2017 Sinovac Limited and Sinovac Amalgamation Sub Limited (N/A) All Cash $437.59 million $7.00 $7.95 376,599 12/31/2017 -11.95% -161.54%
+ OCRX 11/02/2017 Mallinckrodt Public Limited Company (MNK) Special Conditions $42 million $1.52 $1.75 484,404 12/31/2017 -13.14% -177.67%
+ GNCMA 04/04/2017 Liberty Ventures (LVNTA) Special Conditions $2.68 billion $32.50 $40.90 94,445 03/31/2018 -20.54% -64.07%

Disclaimer: I hold positions in Aetna (AET), TerraForm Global (GLBL), Fortress Investment Group (FIG), Southcross Energy Partners (SXE) and NewStar Financial (NEWS). 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

3 Comments

  1. GeorgeCiardi
    December 4, 2017 at 3:23 pm

    Shouldn’t the SVA target price be $8 now?

    • Asif Suria
      December 4, 2017 at 5:28 pm

      Did they accept the higher $8 offer from Sinobioway? I have not seen anything confirming that they accepted that offer.

  2. GeorgeCiardi
    December 4, 2017 at 6:30 pm

    I wasn’t 100% if they accepted the offer either, just noting that the offer was made and it is trading really close to that offer price. I guess proper reporting would be to wait for the official word they accepted the Offer.

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