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Merger Arbitrage Mondays – March 28, 2011

  • March 27, 2011

Merger activity decreased last week with three new deals announced.

You can find all the deals listed below in our Merger Arbitrage Tool that automatically updates itself during market hours.

Deal Statistics:

Total Number of Deals Closed in 201139
Total Number of Deals Not Completed in 20111
Total Number of Pending Deals
Cash Deals42
Stock Deals23
Stock & Cash Deals13
Special Conditions1
Total Number of Pending Deals78



New Deals:

  1. The acquisition of optionsXpress Holdings (OXPS) by Charles Schwab (SCHW) for $1 billion in an all-stock deal. Under the terms of the agreement, optionsXpress stockholders will receive 1.02 shares of Schwab stock for each share of optionsXpress stock.
  2. The acquisition of Drugstore.com (DSCM) by Walgreen (WAG) for $409 million or $3.80 per share in cash.
  3. The acquisition of TGC Industries (TGE) by Dawson Geophysical Company (DWSN) for $157 million in an all-stock deal. Pursuant to the terms of the merger agreement, TGC shareholders will receive 0.188 shares of Dawson stock for every one share of TGC stock, provided that the average of the volume weighted average price of Dawson common stock on the NASDAQ during the ten consecutive trading days ending on the second business day prior to the date of the shareholders’ meetings of Dawson and TGC to be called for the purpose of approving the transaction is equal to or greater than $32.54 but less than or equal to $52.54. In the event that the average of the volume weighted average price of Dawson’s common stock is outside of that range, then the parties, at their respective option, shall be entitled to terminate the transaction following good faith negotiations to determine a modified, mutually acceptable exchange ratio.


Deal Updates:

  1. Verigy Inc. (VRGY)  intends to withdraw recommendation on LTX-Credence (LTXC) deal after receiving a $908 million buyout offer from Japan’s Advantest Corp. As a few hours ago on March 27, Verigy announced the termination of the deal after paying LTX-Credence the $15 million termination fee.
  2. Majestic Capital (MAJC) announces termination of the merger agreement with Bayside Capital Partners on March 21, 2011.
  3. On March 23, 2011, AirTran Stockholders (AAI) approve Southwest merger (LUV) which is currently expected to close in the second quarter of 2011.
  4. On March 24, 2011, (CPEX) Stockholders approve $27.25 per share merger agreement with FCB I Holdings. Transaction is expected to close in April.
  5. On March 25, 2011, shareholders voted for Wilber merger. Merger expected to close on April 08, 2011
  6. On March 25, 2011, Capital Gold Corporation (CGC) urged its shareholders to consider the facts of the superior bid by Gammon Gold.
  7. On March 25, 2011, Avis Budget’s (CAR) top shareholder said it may hold talks with the car rental firm’s board on an appropriate price the company should pay for Dollar Thrifty (DTG).


Top 10 Deals with largest spreads:

SymbolAnnounced
Date
Acquiring

Company

Closing

Price

Last
Price
Closing
Date
ProfitAnnu.
Profit
TAM01/19/2011LAN Airlines S.A. (LFL)$23.33$19.9312/31/2011

17.05%

22.39%
TLCR06/07/2010Grifols (GRF.MC)$30.23$26.3106/30/2011 14.89% 57.82%
DNBK01/20/2011People's United Financial Inc. (PBCT)$23.00$21.4506/30/2011 7.23% 28.06%
HYC11/17/2010Verifone Systems (PAY)$12.14$11.4509/30/2011 6.06% 11.89%
ROME10/12/2010Berkshire Hills Bancorp (BHLB)$12.16$11.5203/31/2011 5.55% 674.91%
MEE01/29/2011Alpha Natural Resources, Inc. (ANR)$71.55$68.2306/30/2011 4.87% 18.90%
CASB03/04/2011Opus Bank (N/A)$0.45$0.430106/30/2011 4.63% 17.97%
SHMR10/15/2010Essilor (N/A)$14.50$13.8606/30/2011 4.62% 17.93%
TGE03/21/2011Dawson Geophysical Company (DWSN)$8.14$7.7808/15/2011

4.58%

11.95%
NGAS12/27/2010Magnum Hunter Resources Corp. (MHR)$0.65$0.621106/30/2011 4.20% 16.31%

List of all pending deals:

The list of all pending deals is only available to InsideArbitrage Premium and Plus members.