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Merger Arbitrage Mondays – October 04, 2010

  • October 3, 2010

Merger activity slid a little with “just” six new deals announced and eleven deals closing as it was the end of the third quarter.

Deal Statistics:

New Deals:

  1. The acquisition of AirTran Holdings (AAI) by Southwest Airlines (LUV) for $1.4 billion or $3.75 per share in cash and 0.321 Southwest share for each share of AirTran held.
  2. The acquisition of Alberto-Culver (ACV) by Consumer goods group Unilever for $3.7 billion or $37.50 per share in cash.
  3. The acquisition of NightHawk Radiology Holdings (NHWK) by privately held Virtual Radiologic for $170 million or $6.50 per share in cash. The offer represented a 100% premium over NightHawk’s previous closing.


Modified Deals:

  1. On Monday, September 27, 2010, Coca-Cola Co (KOwon the approval to buy the North American operations of its largest bottler (CCE) on the condition that it creates a firewall to safeguard rival Dr Pepper Snapple Group’s (DPS) confidential business information. This was a complex deal that I had participated in as discussed in the post Special Report Update: Coca-Cola Enterprises (subscription required) but booked profits when it went over my target price of $28.50 instead of waiting for the deal to close as I wanted to deploy the capital elsewhere.

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