Merger Arbitrage Mondays – July 25, 2011

Merger activity decreased last week with five new deals announced and three closing.

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

Deal Statistics:

Total Number of Deals Closed in 2011 128
Total Number of Deals Not Completed in 2011 1
Total Number of Pending Deals
Cash Deals 36
Stock Deals 23
Stock & Cash Deals 11
Total Number of Pending Deals 70

New Deals:

  1. The acquisition of Nalco Holdings (NLC) by Ecolab (ECL) for $5.4 billion in a stock or cash deal. Under the terms of the agreement, Nalco’s shareholders may elect to receive either 0.7005 share of Ecolab common stock or $38.80 in cash, without interest, per share of Nalco common stock. The overall mix of consideration paid to Nalco shareholders will be approximately 30% cash and 70% stock.
  2. The acquisition of Allos Therapeutics (ALTH) by Amag Pharmaceuticals (AMAG) in an all stock deal for $686 million, where Allos stockholders will receive a fixed ratio of 0.1282 shares of AMAG common stock for each share of Allos common stock they own.
  3. The acquisition of Icagen (ICGN) by Pfizer (PFE) for $56 million or $6.00 per share in cash.
  4. The acquisition of Medco Health Solutions (MHS) by Express Scripts (ESRX) for $29.1 billion in a cash plus stock deal, where Medco shareholders will receive $28.80 in cash and 0.81 shares of Express Scripts for each Medco share they own.
  5. The acquisition of SFN Group (SFN) by Randstad Holding for $770 million or $14.00 per share in cash.

Deal Updates:

  1. On July 19, 2011, Transatlantic Holdings (TRH) announced that it has determined that the proposal set forth in the letter received from Validus Holdings (VR) on July 12, 2011 to acquire all of the outstanding shares of Transatlantic common stock does not constitute a “Superior Proposal” under the merger agreement that Transatlantic entered into with Allied World Assurance Company Holdings.
  2. On July 20, 2011, Validus Holdings (VR) said that it still wants to acquire fellow insurance company Transatlantic Holdings (TRH) and argued that its bid for the company is better than that of a Switzerland-based rival.

Closed Deals:

  1. The acquisition of SRA International (SRX) by Providence Equity Partners on July 20, 2011
  2. The acquisition of Warner Music Group (WMG) by Access Industries on July 20, 2011
  3. The acquisition of Legacy Bancorp (LEGC) by Berkshire Hills (BHLB) on July 21, 2011

Top 10 deals with largest spreads:

Symbol Announced

Date

Acquiring

Company

Closing

Price

Last

Price

Closing

Date

Profit Annualized

Profit

GRAN 04/27/2011 FNB United Corp (FNBN) $1.49 $0.83 09/30/2011 78.92% 429.91%
HRBN 06/20/2011 Tech Full Electric Company Limited (N/A) $24.00 $19.39 12/31/2011 23.78% 54.58%
CSR 04/20/2011 Rightmark Holdings Limited (N/A) $6.50 $5.56 09/30/2011 16.91% 92.10%
TAM 01/19/2011 LAN Airlines S.A. (LFL) $25.74 $22.24 12/31/2011 15.74% 36.13%
MHS 07/21/2011 Express Scripts, Inc. (ESRX) $75.21 $65.96 06/30/2012 14.03% 15.02%
ALTH 07/20/2011 Amag Pharmaceuticals (AMAG) $2.03 $1.80 12/31/2011 12.89% 29.58%
CFSG 05/20/2011 Bain Capital Partners (N/A) $9.00 $8.30 11/15/2011 8.43% 27.24%
ZRAN 02/21/2011 CSR PLC (CSR.L) $9.18 $8.53 09/30/2011 7.67% 41.78%
CRU 05/05/2011 Capital Product Partners L.P. (CPLP) $13.46 $12.59 09/30/2011 6.93% 37.77%
FTLK 05/31/2011 Fortress Group Limited (N/A) $7.20 $6.80 09/30/2011 5.88% 32.05%

List of all pending deals:

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


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