Merger Arbitrage Mondays – September 20, 2010

  • September 20, 2010

Merger activity increased last week with five new deals announced and two deals closing.

Deal Statistics:

Total Number of Deals Closed in 201069
Total Number of Deals That Did Not Complete in 20105
Total Number of Pending Deals
Cash Deals47
Stock Deals10
Stock & Cash Deals13
Total Number of Pending Deals70

New Deals:

  1. The acquisition of ArcSight Inc. (ARST) by Hewlett-Packard (HPQ) for $1.5 billion at $43.50 per share in cash
  2. The acquisition of OTIX Global Inc. (OTIX) by William Demant for $50 million at $8.60 per share in cash
  3. The acquisition of O.I. Corporation (OICO) by ITT Corporation (ITT) for $29 million at $12.50 per share in cash
  4. The acquisition of Occam Networks Inc. (OCNW) by Telco equipment maker Calix Inc. (CALX) for $171 million at $7.75 per share in cash and stock.
  5. The acquisition of Cellu Tissue Holdings (CLU) by Clearwater Paper Corp. (CLW) for $247 million at $12 per share in cash

Modified Deals and Other News:

  1. Hertz (HTZ) raised its offer for Dollar Thrifty Automotive Group Inc. (DTG)  to $50 a share, or about $1.56 billion, topping a proposal from Avis Budget Group Inc. (CAR)
  2. Jefferies & Company reiterates its Hold rating on Allegheny Energy (AYE) and lowers its price target to $23.50, from $24.50.
  3. On September 15, 2010, Pet DRx Corporation (VETS) (the “Company”) received a Nasdaq Staff Determination letter notifying the Company that it will be delisted from The Nasdaq Stock Market
  4. Naugatuck Valley Financial Corporation (NVSL) and Southern Connecticut Bancorp (SSE) announced on September 17, 2010  that they have amended certain terms of their Agreement and Plan of Merger, under which SCBI shareholders will be entitled to receive $6.75 per share of SCBI common stock owned. The acquisition is expected to be completed in the fourth calendar quarter of 2010 or in early 2011.


Closed Deals:

  1. The acquisition of Biosphere Medical (BSMD) by Merit Medical Systems Inc. on September 13, 2010
  2. The acquisition of SouthWest Water Company (SWWC) by Institutional Investors advised by J.P. Morgan Asset Management and Water Asset Management, LLC on September 13, 2010

Top 10 Deals with largest spreads:

SymbolAnnounced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
ProfitAnnu.
Profit
TLCR06/07/2010Grifols (GRF.MC)$27.39$22.9512/31/2010 19.36% 69.29%
SSE02/23/2010Naugatuck Valley Financial Corp (NVSL)$6.75$6.0012/31/2010 12.50% 44.73%
ADAM08/30/2010Ebix Inc. (EBIX)$5.92$5.5412/31/2010 6.79% 24.30%
ALY08/12/2010Seawell (N/A)$4.25$4.0112/31/2010 5.99% 21.42%
AYE02/11/2010FirstEnergy (FE)$24.22$22.8603/31/2011 5.94% 11.30%
SMTB07/15/2010People's United Financial Inc. (PBCT)$3.85$3.6812/31/2010 4.71% 16.85%
Q04/22/2010Century Link (CTL)$6.45$6.1804/21/2011 4.44% 7.62%
OCNW09/16/2010Calix Inc. (CALX)$7.48$7.1712/31/2010 4.26% 15.24%
BGH06/11/2010Buckeye Partners LP (BPL)$43.82$42.0512/31/2010 4.22% 15.09%
BNE02/24/2010RR Donnelley (RRD)$11.50$11.0709/30/2010 3.88% 141.78%

List of all Pending Deals:

 SymbolAnnounced
Date
Acquiring
Company
Closing
Value
Closing
Price
Last
Price
Closing
Date
ProfitAnnu.

Profit

+TLCR06/07/2010Grifols (GRF.MC)$3.4 billion$27.39$22.9512/31/2010 19.36% 69.29%
+SSE02/23/2010Naugatuck Valley Financial Corp (NVSL)$19.5 million$6.75$6.0012/31/2010 12.50% 44.73%
+ADAM08/30/2010Ebix Inc. (EBIX)$66 million$5.92$5.5412/31/2010 6.79% 24.30%
+ALY08/12/2010Seawell (N/A)$890 million$4.25$4.0112/31/2010 5.99% 21.42%
+AYE02/11/2010FirstEnergy (FE)$8.5 billion$24.22$22.8603/31/2011 5.94% 11.30%
+SMTB07/15/2010People's United Financial Inc. (PBCT)$60 million$3.85$3.6812/31/2010 4.71% 16.85%
+Q04/22/2010Century Link (CTL)$10.6 billion$6.45$6.1804/21/2011 4.44% 7.62%
+OCNW09/16/2010Calix Inc. (CALX)$171 million$7.48$7.1712/31/2010 4.26% 15.24%
+BGH06/11/2010Buckeye Partners LP (BPL)$1.14 billion$43.82$42.0512/31/2010 4.22% 15.09%
+BNE02/24/2010RR Donnelley (RRD)$481 million$11.50$11.0709/30/2010 3.88% 141.78%
+TSFG05/17/2010TD Bank Financial Group (N/A)$61 million$0.28$0.272109/30/2010 2.90% 105.97%
+PRPX02/17/2010L.B. Foster Co. (FSTR)$112 million$11.80$11.4812/30/2010 2.79% 10.07%
+EPE09/07/2010Enterprise Products (EPD)$8 billion$57.32$55.8012/31/2010 2.72% 9.72%
+CCBP08/09/2010F.N.B. Corporation (FNB)$70 million$39.50$38.5712/31/2010 2.41% 8.64%
+OTIX09/13/2010William Demant (N/A)$50 million$8.60$8.4012/31/2010 2.38% 8.52%
+PTV08/17/2010Reynolds Group Holdings (N/A)$6 billion$33.25$32.4912/31/2010 2.34% 8.37%
+OMNI06/04/2010Wellspring Capital Management (N/A)$122 million$2.75$2.6911/15/2010 2.23% 14.54%
+ATAC07/19/2010Genco Distribution System Inc. (N/A)$513 million$25.00$24.4712/31/2010 2.17% 7.75%
+NRGP08/09/2010Inergy (NRGY)$2.07 billion$29.84$29.2312/31/2010 2.08% 7.44%
+OICO09/14/2010ITT Corporation (ITT)$29 million$12.50$12.2512/31/2010 2.04% 7.30%
+DIVX06/02/2010Sonic Solutions (SNIC)$323 million$8.09$7.9709/30/2010 1.48% 54.11%
+MFE08/19/2010Intel Corporation (INTC)$7.68 billion$48.00$47.3012/31/2010 1.48% 5.30%
+MIR04/12/2010RRI Energy In. (RRI)$1.6 billion$10.09$9.9612/31/2010 1.33% 4.76%
+LSBX07/15/2010People's United Financial Inc. (PBCT)$96 million$21.00$20.7312/31/2010 1.30% 4.66%
+WAIN06/29/2010Eastern Bank (N/A)$163 million$19.00$18.7612/31/2010 1.28% 4.58%
+ME04/15/2010Apache (APA)$2.7 billion$23.90$23.6309/30/2010 1.15% 42.05%
+NAL08/19/2010First Niagara Financial Group (FNFG)$1.5 billion$12.52$12.3805/15/2011 1.11% 1.72%
+CLU09/16/2010Clearwater Paper Corporation (CLW)$247 million$12.00$11.8712/31/2010 1.10% 3.92%
+MAM03/12/2010Emera Inc (N/A)$75.7 million$45.00$44.5312/31/2010 1.06% 3.78%
+ALOY06/24/2010ZelnickMedia (N/A)$126.5 million$9.80$9.7012/31/2010 1.03% 3.69%
+PMACA06/10/2010Old Republic International (ORI)$228 million$7.40$7.3309/30/2010 0.92% 33.61%
+XJT08/04/2010SkyWest (SKYW)$133 million$6.75$6.6912/31/2010 0.90% 3.21%
+BKC09/02/20103G Capital (N/A)$3.26 billion$24.00$23.8012/31/2010 0.84% 3.01%
+PSYS05/17/2010Universal Health (N/A)$3.1 billion$33.75$33.4712/31/2010 0.84% 2.99%
+GLG05/17/2010Man Group (N/A)$1.6 billion$4.50$4.4709/30/2010 0.67% 24.50%
+OSTE08/17/2010Medtronic (MDT)$123 million$6.50$6.4612/31/2010 0.62% 2.22%
+AMPH09/01/2010ProAssuarance (PRA)$233 million$32.50$32.3112/31/2010 0.59% 2.10%
+ACF07/22/2010General Motors Co. (N/A)$3.5 billion$24.50$24.3812/31/2010 0.49% 1.76%
+ADCT07/13/2010Tyco Electronics (TEL)$1.24 billion$12.75$12.6912/31/2010 0.47% 1.69%
+RSCR09/07/2010Onex Corp (N/A)$390 million$13.25$13.1912/31/2010 0.45% 1.63%
+HEW07/12/2010Aon Corp (AON)$4.9 billion$49.86$49.6611/15/2010 0.41% 2.65%
+DTPI08/24/2010PricewaterhouseCoopers (N/A)$378 million$12.50$12.4512/31/2010 0.40% 1.44%
+ACAP07/08/2010The Doctors Company (N/A)$386 million$41.50$41.3612/31/2010 0.34% 1.21%
+NTY07/15/2010The Carlyle Group (N/A)$3.8 billion$55.00$54.8212/31/2010 0.33% 1.17%
+NYM07/15/2010ProSight (N/A)$230 million$25.75$25.6812/31/2010 0.27% 0.98%
+SLRY09/01/2010Kenexa Corp. (KNXA)$80 million$4.07$4.0612/31/2010 0.25% 0.88%
+UNCA08/13/2010IBM (IBM)$480 million$21.00$20.95512/31/2010 0.21% 0.77%
+PPCO08/09/2010Endo Pharmaceuticals (ENDP)$144 million$5.00$4.9912/31/2010 0.20% 0.72%
+MEND07/12/2010Johnson & Johnson (JNJ)$480 million$23.40$23.3709/30/2010 0.13% 4.69%
+HGRD07/28/2010an affiliate of the private equity firm Vestar Capital (N/A)$294 million$8.20$8.1909/30/2010 0.12% 4.46%
+ZGEN09/07/2010Bristol Myers Squibb Company (BMY)$885 million$9.75$9.7412/31/2010 0.10% 0.37%
+CAL05/03/2010United (UAUA)$1.2 billion$23.05$23.0412/31/2010 0.03% 0.12%
+BXC07/22/2010Cerberus Capital Management (N/A)$111.1 million$3.40$3.4012/31/2010 0.00% 0.00%
+TUNE09/08/2010Zoran Corporation (ZRAN)$84 million$2.92$2.9212/31/2010 0.00% 0.00%
+AEZ07/28/2010Hess Corp (HES)$450 million$7.55$7.5512/31/2010 -0.03% -0.12%
+ICXT08/16/2010FLIR Systems (FLIR)$274 million$7.55$7.5612/31/2010 -0.13% -0.47%
+ARST09/13/2010Hewlett-Packard Company (HPQ)$1.5 billion$43.50$43.5712/31/2010 -0.16% -0.57%
+WEL04/09/2010Halliburton Company (HAL)$240 million$3.00$3.0109/30/2010 -0.33% -12.13%
+VRX06/21/2010Biovail Corporation (BVF)$3.3 billion$64.14$64.6012/31/2010 -0.71% -2.54%
+PZZ08/16/2010Leonard Green & Partners (N/A)$363 million$8.50$8.6312/31/2010 -1.51% -5.39%
+TRBN08/12/2010Emergent BioSolution (EBS)$96.8 million$4.39$4.5112/31/2010 -2.75% -9.83%
+ABII06/30/2010Celgene (CELG)$2.9 billion$72.46$75.0812/31/2010 -3.49% -12.49%
+COGT08/30/20103M Co. (MMM)$943 million$10.50$10.9612/31/2010 -4.20% -15.02%
+PTEC08/17/2010Marlin Equity Partners (N/A)$139 million$3.85$4.0212/31/2010 -4.23% -15.13%
+PTEC08/17/2010Marlin Equity Partners (N/A)$139 million$3.85$4.0212/31/2010 -4.23% -15.13%
+DYN08/13/2010Blackstone Group (BX)$4.7 billion$4.50$4.7912/31/2010 -6.05% -21.66%
+PAR08/28/2010Hewlett-Packard Company (HPQ)$2 billion$30.00$32.9612/31/2010 -8.98% -32.14%
+ATBC05/10/2010Jacksonville Bancorp (JAXB)N/A$2.20$2.420109/30/2010 -9.09% -331.96%
+DTG04/26/2010Hertz (HTZ)$1.56 billion$39.80$51.0012/31/2010 -21.97% -78.61%
+CCE02/25/2010The Coca-Cola Company (KO)$12.3 billionN/A$30.1910/01/2010 N/A N/A