Merger Arbitrage Mondays – April 23, 2012

  • April 23, 2012

Merger activity increased last week with five new deals announced and two 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 201246
Total Number of Pending Deals
Cash Deals39
Stock Deals10
Stock & Cash Deals7
Total Number of Pending Deals56
Total Deal Size$365.16 billion

New Deals:

  1. The acquisition of Dreams (DRJ) by Fanatics for $183 million or $3.45 per share in cash. I recollect reading a compelling article about Dreams last December when the stock was trading around $2.63 that mentioned Dr. Phillip Frost as a board member and a large shareholder. Those of you who also follow our Insider Weekends series of posts will recollect that numerous insider purchases of Opko Health (OPK) and Ladenburg Thalmann (LTS) by Dr. Frost.
  2. The acquisition of The Edelman Financial Group (EF) by Lee Equity Partners for $258 million or $8.85 per share in cash.
  3. The acquisition of SRS Labs (SRSL) by DTS Inc. (DTSI) for $148 million in a cash plus stock deal. Under the terms of the agreement, SRS Labs shareholders may elect to receive either $9.50 per share in cash or a fixed ratio of 0.31127 shares of DTS common stock for every share of SRS Labs common stock they own. In order to take a more conservative approach, we have internally classified the deal as an all stock transaction for now.
  4. The acquisition of Catalyst Health Solutions (CHSI) by SXC Health Solutions (SXCI) in a cash plus stock deal for $4.4 billion. Under the terms of the agreement, Catalyst shareholders will receive $28.00 in cash and 0.6606 shares of SXC stock for each Catalyst share.
  5. The acquisition of Knology (KNOL) by WOW! Internet, Cable & Phone for $1.5 billion or $19.75 per share in cash.

Updated Deals:

  1. On April 15, 2012, Great Wolf Resorts (WOLF) deemed KSL Capital’s offer of $7.00 per share, superior to Apollo Global Management’s (APO) offer.
  2. On April 18, 2012, Amaya Gaming Group extended its buyout offer for CryptoLogic (CRYP) to May 2, 2012.
  3. On April 18, 2012, Blackbaud (BLKB) extended its offer to acquire Convio (CNVO) to May 2, 2012.

Closed Deals:

  1. The acquisition of China GrenTech (GRRF) by Talenthome Management Limited on April 18, 2012.
  2. The acquisition of Parlux Fragrances (PARL) by Perfumania Holdings (PERF) on April 18, 2012.

Top 10 deals with largest spreads:

SymbolAnnounced

Date

Acquiring

Company

Closing

Price

Last

Price

Closing

Date

ProfitAnnualized

Profit

CADC10/24/2011Novel Gain Holdings Limited (N/A)$2.65$2.1506/30/201223.26%124.83%
VQ01/16/2012Denver Parent Corporation (N/A)$12.50$10.9406/30/201214.26%76.54%
CMFB12/20/2011Sandy Spring Bancorp Inc. (SASR)$14.77$13.6306/30/20128.34%44.77%
INCB01/25/2012Old National Bancorp Capital (ONB)$24.13$22.5006/30/20127.24%38.89%
SCMF03/27/2012Capital Bank Financial Corp (N/A)$2.88$2.7306/30/20125.49%29.49%
TUDO03/12/2012Youku Inc. (YOKU)$36.69$34.8109/30/20125.39%12.29%
CTBC10/26/2011Berkshire Hills Bancorp, Inc. (BHLB)$8.82$8.4004/30/20124.96%258.44%
PGN01/10/2011Duke Energy Corporation (DUK)$54.89$52.4807/01/20124.59%24.28%
VIST01/26/2012Tompkins Financial Corporation (TMP)$12.45$11.9209/30/20124.41%10.06%
TAM01/19/2011LAN Airlines S.A. (LFL)$25.88$24.9006/30/20123.92%21.02%

List of all pending deals:

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


SymbolAnnounced

Date

Acquiring

Company

Deal

Type

Closing

Value

Closing

Price

Last

Price

VolumeClosing

Date

ProfitAnnu.

Profit

+CADC10/24/2011Novel Gain Holdings Limited (N/A)All CashN/A$2.65$2.1519,20006/30/201223.26%124.83%
+VQ01/16/2012Denver Parent Corporation (N/A)All Cash$1.5 billion$12.50$10.94356,74306/30/201214.26%76.54%
+CMFB12/20/2011Sandy Spring Bancorp Inc. (SASR)All Stock$25.4 million$14.77$13.633,90906/30/20128.34%44.77%
+INCB01/25/2012Old National Bancorp Capital (ONB)All Stock$79.2 million$24.13$22.503,64706/30/20127.24%38.89%
+SCMF03/27/2012Capital Bank Financial Corp (N/A)All CashN/A$2.88$2.7316,50306/30/20125.49%29.49%
+TUDO03/12/2012Youku Inc. (YOKU)All Stock$1 billion$36.69$34.81197,04209/30/20125.39%12.29%
+CTBC10/26/2011Berkshire Hills Bancorp, Inc. (BHLB)All Stock$30 million$8.82$8.40N/A04/30/20124.96%258.44%
+PGN01/10/2011Duke Energy Corporation (DUK)All Stock$13.7 billion$54.89$52.483,125,10907/01/20124.59%24.28%
+VIST01/26/2012Tompkins Financial Corporation (TMP)All Stock86 million$12.45$11.922,38509/30/20124.41%10.06%
+TAM01/19/2011LAN Airlines S.A. (LFL)All StockN/A$25.88$24.90678,81506/30/20123.92%21.02%
+EP10/16/2011Kinder Morgan, Inc. (KMI)Cash Plus Stock$21 billion$30.75$29.676,908,31606/30/20123.64%19.54%
+MMI08/15/2011Google (GOOG)All Cash$12.5 billion$40.00$38.837,184,74106/30/20123.01%16.17%
+RFMI04/13/2012Murata Manufacturing (N/A)All Cash$19.6 million$1.78$1.73848,67809/30/20122.89%6.59%
+CNVO01/17/2012Blackbaud (BLKB)All Cash$275 million$16.00$15.68104,42405/02/20122.04%82.77%
+OPXT03/26/2012Oclaro, Inc. (OCLR)All Stock$177 million$1.39$1.36293,84306/30/20121.91%10.26%
+CHSI04/18/2012SXC Health Solutions, Corp. (SXCI)Cash Plus Stock$4.4 billion$91.29$89.612,556,64012/31/20121.88%2.72%
+SURW02/06/2012Consolidated Communications Holdings, Inc. (CNSL)All Cash$340.9 million$23.00$22.5943,28106/30/20121.81%9.74%
+GR09/21/2011United Technologies Corp. (UTX)All Cash$18.4 billion$127.50$125.30555,11706/30/20121.76%9.42%
+KNOL04/18/2012WOW! Internet, Cable & Phone (N/A)All Cash$1.5 billion$19.75$19.421,135,12209/30/20121.70%3.88%
+DRJ04/16/2012Fanatics (N/A)All Cash$183 million$3.45$3.401,553,67609/30/20121.47%3.35%
+ABVT03/19/2012Zayo Group (N/A)All Cash$2.2 billion$84.00$83.05317,27712/31/20691.14%0.02%
+PCBC03/12/2012UnionBanCal Corp. (N/A)All Cash$1.51 billion$46.00$45.4920,51712/31/20121.12%1.62%
+FFFD03/13/2012Great Western Bancorporation, Inc. (N/A)All Cash$41.5 million$30.58$30.257,30008/31/20121.09%3.06%
+SOA01/27/2012Eastman Chemical Company (EMN)Cash Plus Stock$4.7 billion$28.33$28.04674,20606/30/20121.04%5.57%
+ERT04/10/2012Genstar Capital LLC (N/A)All Cash$400 million$8.00$7.92360,31509/30/20121.01%2.30%
+EF04/16/2012Lee Equity Partners, LLC (N/A)All Cash$258 million$8.85$8.77318,02309/30/20120.91%2.08%
+CRIC12/28/2011E-House (China) Holdings (EJ)Cash Plus Stock$603 million$5.65$5.6036,15706/30/20120.89%4.79%
+RVSN03/15/2012Avaya (N/A)All Cash$230 million$11.85$11.7535,37912/31/20690.85%0.01%
+EBTX03/06/2012Cadence Bancorp (N/A)All Cash$250 million$20.62$20.4719,60212/31/20120.73%1.06%
+ISTA03/26/2012Bausch + Lomb (N/A)All Cash$500 million$9.10$9.04760,13906/30/20120.66%3.56%
+NVLS12/14/2011Lam Research Corp (LRCX)All Stock$3.3 billion$45.44$45.221,314,15206/30/20120.48%2.60%
+ADGF03/19/2012TaylorMade-adidas Golf business (N/A)All Cash$70 million$10.80$10.7517,67212/31/20690.47%0.01%
+RRR12/16/2011United Rentals, Inc. (URI)Cash Plus Stock$1.9 billion$23.37$23.272,054,41906/30/20120.42%2.26%
+HGIC09/29/2011Nationwide Mutual Insurance Co (N/A)All Cash$760 million$60.00$59.75148,32406/30/20120.42%2.25%
+DDIC04/04/2012Viasystems Group Inc. (VIAS)All Cash$268 million$13.00$12.95373,67307/31/20120.39%1.42%
+PBY01/30/2012The Gores Group (N/A)All Cash$1 billion$15.00$14.95432,08706/30/20120.33%1.80%
+ARCL03/05/2012PLATO Learning (N/A)All Cash$291 million$11.10$11.08152,60006/30/20120.18%0.97%
+XRIT04/10/2012Danaher (DHR)All Cash$625 million$5.55$5.54681,17706/30/20120.18%0.97%
+SRSL04/17/2012DTS, Inc. (DTSI)Cash Plus Stock$148 million$9.38$9.37N/A09/30/20120.12%0.28%
+TNB01/30/2012ABB Ltd (ABB)All Cash$3.9 billion$72.00$71.92163,48206/30/20120.11%0.60%
+ZOLL03/12/2012Asahi Kasei Corp (N/A)All Cash$2.21 billion$93.00$92.901,957,44006/30/20120.11%0.58%
+LOOP04/27/2011CoStar Group (CSGP)Cash Plus Stock$860 million$19.13$19.11492,36004/30/20120.10%5.03%
+CV07/12/2011Gaz metro Limited Partnership (N/A)All Cash$702 million$35.25$35.2263,58906/30/20120.09%0.46%
+AEA02/15/2012Grupo Elektra (N/A)All Cash$780 million$10.50$10.50599,14306/30/20120.00%0.00%
+CRYP02/02/2012Amaya Gaming Group (N/A)All Cash$35.82 million$2.54$2.545,91305/02/20120.00%0.00%
+CHUX02/06/2012Fidelity National Financial, Inc. (FNF)All Cash$221 million$9.85$9.8553,92906/30/20120.00%0.00%
+TRCR03/07/2012Nuance Communications (NUAN)All Cash$300 million$29.50$29.5081,96209/30/20120.00%0.00%
+MDS03/13/2012TBC Corporation (N/A)All Cash$310 million$11.50$11.50277,06006/30/20120.00%0.00%
+ALTH04/05/2012Spectrum Pharmaceuticals (SPPI)All Cash$206 million$1.82$1.823,088,62006/30/20120.00%0.00%
+SRLS02/13/2012Linden Capital Partners (N/A)All Cash$82 million$4.00$4.0141,38706/30/2012-0.25%-1.34%
+COMV03/26/2012Peak Merger Corp (N/A)All Cash$49 million$1.75$1.76154,40806/30/2012-0.57%-3.05%
+QSFT03/09/2012Insight Venture Partners (N/A)All Cash$2 billion$23.00$23.18412,52609/30/2012-0.78%-1.77%
+DFG12/21/2011Tokio Marine Holdings (N/A)All Cash$2.7 billion$44.80$45.40263,88306/30/2012-1.32%-7.09%
+CHG02/21/2012Fortis Inc. (N/A)All Cash$1.5 billion$65.00$66.0554,88803/31/2013-1.59%-1.70%
+BXG11/14/2011BFC Financial Corporation (BFCF.PK)All StockN/A$5.80$6.10110,13906/30/2012-4.92%-26.40%
+WOLF03/13/2012An affiliate of Apollo Global Management, LLC (N/A)All Cash$703 million$5.00$8.061,511,62806/30/2012-37.97%-203.78%