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Merger Arbitrage Mondays – May 16, 2016

  • May 15, 2016

Merger activity decreased last week with four new deals announced and seven deals 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 201680
Total Number of Deals Not Completed in 20165
Total Number of Pending Deals
Cash Deals44
Stock Deals18
Stock & Cash Deals16
Special Conditions9
Total Number of Pending Deals87
Total Deal Size$830.91 billion

New Deals:

  1. The acquisition of Krispy Kreme Doughnuts (KKD) by JAB Beech for $1.35 billion or $21.00 per share in cash.
  2. The acquisition of Morgans Hotel Group (MHGC) by SBE for $794 million or $2.25 per share in cash.
  3. The acquisition of Alexza Pharmaceuticals (ALXA) by Grupo Ferrer Internacional for $0.90 per share in cash. In addition to the upfront cash payment, Alexza stockholders will be granted contingent value rights to receive cash payments in four payment categories if specified milestones are achieved following the closing.
  4. The acquisition of WaferGen Bio-systems (WGBS) by Takara Bio USA Holdings for $18 million or $0.95 per share in cash. This is a complex deal with many conditions that make it challenging to determine the actual value of this deal on a per share basis. Using their full year 2015 revenue and applying a multiple of 2.5, we get a rough estimate of $0.95/share and are going to use this price as a placeholder in our database.

Deal Updates:

  1. On May 10, 2016, Pier Antonio Costamagna, a co-founder of Fuel Systems Solutions (FSYSfiled a presentation with the U.S. Securities and Exchange Commission that was sent to the leading proxy advisory firms in the United States. The presentation details three fundamental themes that underline Mr. Costamagna’s decision to vote AGAINST the proposed merger of FSS and Westport (WPRT).
  2. On May 11, 2016, Office Depot (ODP) issued the following statement from Chairman and Chief Executive Officer Roland Smith after the U.S. District Court in the District of Columbia granted the Federal Trade Commission’s (FTC) request for a preliminary injunction to block the proposed merger of Staples (SPLS) and Office Depot. Smith commented: “While we are respectful of the Court’s decision to grant the FTC’s request for a preliminary injunction to prevent our merger with Staples, we are disappointed by this outcome and strongly believe that a merger would have benefitted all of our customers in the long term. We do not intend to appeal the Court’s decision and the two companies plan to terminate the merger agreement effective May 16, 2016.”
  3. On May 12, 2016, California regulators authorized the three-way merger of Charter Communications (CHTR), Time Warner Cable (TWC) and Bright House Networks, and the huge deal is expected to close on or about May 18, 2016.
  4. On May 13, 2016, Williams Companies (WMB) said it has filed a lawsuit against Energy Transfer Equity (ETE) to prevent it from terminating its once-coveted deal for Williams.
  5. On May 13, 2016, ON Semiconductor Corporation (ON) announced that it has extended its previously announced tender offer to purchase all of the outstanding shares of common stock of Fairchild Semiconductor International (FCS) to May 26, 2016.

Closed Deals:

  1. The acquisition of PowerSecure International (POWR) by Southern Company (SO) on May 9, 2016. It took 75 days for this deal to be completed.
  2. The acquisition of VBI Vaccines (VBIV) by SciVac Therapeutics (SVACF) on May 9, 2016. It took 196 days for this deal to be completed.
  3. The acquisition of NTELOS Holdings (NTLS) by Shenandoah Telecommunications (SHEN) on May 9, 2016. It took 273 days for this deal to be completed.
  4. The acquisition of Mattson Technology (MTSN) by Beijing E-Town Dragon Semiconductor Industry Investment Center on May 11, 2016. It took 162 days for this deal to be completed.
  5. The acquisition of VirtualScopics (VSCP) by BioTelemetry (BEAT) on May 11, 2016. It took 47 days for this deal to be completed.
  6. The acquisition of SanDisk (SNDK) by Western Digital Corporation (WDC) on May 12, 2016. It took 204 days for this deal to be completed.
  7. The acquisition of Jiayuan.com International (DATE) by FutureWorld on May 13, 2016. It took 158 days for this deal to be completed.

Top 10 deals with largest spreads:

SymbolAnnounced

Date

Acquiring

Company

Closing

Price

Last

Price

Closing

Date

ProfitAnnualized

Profit

WMB09/28/2015Energy Transfer Equity, L.P. (ETE)$43.50$19.3506/30/2016124.81%1012.32%
ALR02/01/2016Abbott Laboratories (ABT)$56.00$39.8712/31/201640.46%64.48%
CI07/24/2015Anthem, Inc. (ANTM)$173.21$128.3612/31/201634.94%55.70%
HUM07/03/2015Aetna Inc. (AET)$215.37$165.2312/31/201630.34%48.36%
IM02/17/2016Tianjin Tianhai Investment Company, Ltd. (N/A)$38.90$33.0012/31/201617.88%28.50%
RAD10/27/2015Walgreens Boots Alliance, Inc. (WBA)$9.00$7.9512/31/201613.21%21.05%
HTCH11/02/2015TDK Corporation (N/A)$4.00$3.5706/30/201612.04%97.70%
BNK11/09/2015Bank of the Ozarks, Inc. (OZRK)$25.00$22.5806/30/201610.72%86.93%
KUTV04/05/2016Shanda Investment Holdings Limited (N/A)$1.08$0.9812/31/201610.20%16.26%
DSKY12/31/2015Dream Investment Holdings Limited (N/A)$14.00$12.7406/30/20169.89%80.22%

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

+WMB09/28/2015Energy Transfer Equity, L.P. (ETE)Special Conditions$37.7 billion$43.50$19.3513,797,39106/30/2016124.81%1012.32%
+ALR02/01/2016Abbott Laboratories (ABT)All Cash$5.8 billion$56.00$39.87587,19112/31/201640.46%64.48%
+CI07/24/2015Anthem, Inc. (ANTM)Cash Plus Stock$54.2 billion$173.21$128.361,551,59212/31/201634.94%55.70%
+HUM07/03/2015Aetna Inc. (AET)Cash Plus Stock$37 billion$215.37$165.232,068,04812/31/201630.34%48.36%
+IM02/17/2016Tianjin Tianhai Investment Company, Ltd. (N/A)All Cash$6 billion$38.90$33.002,656,73212/31/201617.88%28.50%
+RAD10/27/2015Walgreens Boots Alliance, Inc. (WBA)All Cash$17.2 billion$9.00$7.9519,703,97612/31/201613.21%21.05%
+HTCH11/02/2015TDK Corporation (N/A)Special Conditions$126 million$4.00$3.57291,72006/30/201612.04%97.70%
+BNK11/09/2015Bank of the Ozarks, Inc. (OZRK)Special Conditions$402.5 million$25.00$22.5837,90506/30/201610.72%86.93%
+KUTV04/05/2016Shanda Investment Holdings Limited (N/A)All CashN/A$1.08$0.9821,01112/31/201610.20%16.26%
+DSKY12/31/2015Dream Investment Holdings Limited (N/A)All CashN/A$14.00$12.7453,60906/30/20169.89%80.22%
+FGL11/09/2015Anbang Insurance Group Co., Ltd. (N/A)All CashN/A$26.80$24.64501,70006/30/20168.77%71.10%
+LXK04/19/2016consortium of investors led by Apex Technology Co., Ltd. (Apex) and PAG Asia Capital (PAG) (N/A)All Cash$3.6 billion$40.50$37.25941,28312/31/20168.72%13.91%
+NPD03/16/2016China Neptunus Drugstore Holding Ltd. and Neptunus Global Limited (N/A)All Cash$258.66 million$2.62$2.4174,90909/30/20168.71%23.22%
+APOL02/08/2016A consortium of investors including The Vistria Group, LLC, funds affiliated with Apollo Global Management, LLC and and Najafi Companies (N/A)All Cash$1.1 billion$10.00$9.281,299,58612/31/20167.76%12.37%
+HOT11/16/2015Marriott International, Inc. (MAR)Special Conditions$13.6 billion$79.53$74.122,659,11206/30/20167.30%59.20%
+MHGC05/09/2016SBE (N/A)All Cash$794 million$2.25$2.101,886,38712/31/20167.14%11.38%
+TIVO04/29/2016Rovi Corporation (ROVI)Special Conditions$1.1 billion$10.70$9.993,315,75709/30/20167.11%18.93%
+NKA06/14/2015Brookfield Infrastructure (N/A)All Cash$911.9 million$4.23$3.99130,87512/31/20166.02%9.59%
+TYC01/25/2016Johnson Controls Inc. (JCI)All Stock$16.5 billion$40.61$38.372,071,26409/30/20165.83%15.53%
+VAL03/20/2016The Sherwin-Williams Company (SHW)All Cash$11.3 billion$113.00$106.89735,67203/31/20175.72%6.54%
+WGBS05/13/2016Takara Bio USA Holdings, Inc. (N/A)Special Conditions$18 million$0.95$0.905,536,09503/31/20175.56%6.36%
+FCLF04/26/2016First Mid-Illinois Bancshares, Inc. (FMBH)All Stock$90 million$12.40$11.781,10012/31/20165.30%8.45%
+AMTG02/26/2016Apollo Commercial Real Estate Finance, Inc. (ARI)Cash Plus Stock$641 million$14.17$13.46271,15708/15/20165.26%21.12%
+NHLD04/28/2016Fortress Biotech, Inc. (FBIO)All CashN/A$3.25$3.0930,47606/30/20165.18%42.00%
+STJ04/28/2016Abbott Laboratories (ABT)Cash Plus Stock$25 billion$79.49$75.744,509,72312/31/20164.95%7.90%
+LSBG05/05/2016Bar Harbor Bankshares (BHB)All Stock$143 million$15.74$15.0712,09703/31/20174.48%5.12%
+ITC02/09/2016Fortis Inc. (FTS.TO)Cash Plus Stock$11.3 billion$46.23$44.25762,57412/31/20164.47%7.12%
+BXLT01/11/2016Shire plc (SHPG)Cash Plus Stock$32 billion$44.04$42.3913,579,14406/30/20163.89%31.58%
+MY02/03/2016A consortium of investors (the Buyer Consortium), including Mr. Chuanwei Zhang, the Chairman and Chief Executive Officer of the Company (N/A)All Cash$408 million$2.51$2.42498,11806/30/20163.72%30.17%
+HFFC11/30/2015Great Western Bancorp. Inc. (GWB)All Stock$139.5 million$20.26$19.64122,36105/13/20163.16%0.00%
+RSTI03/16/2016Coherent Inc. (COHR)All Cash$942 million$32.50$31.56142,45312/31/20162.98%4.75%
+VA04/04/2016Alaska Air Group, Inc. (ALK)All Cash$4 billion$57.00$55.46969,87701/01/20172.78%4.41%
+CBNK04/04/2016Westfield Financial Inc. (WFD)All Stock$110 million$18.48$18.0012,06512/31/20162.66%4.24%
+DWA04/28/2016NBCUniversal (N/A)All Cash$3.8 billion$41.00$40.002,329,37812/31/20162.50%3.98%
+AF10/29/2015New York Community Bancorp Inc. (NYCB)Cash Plus Stock$2 billion$15.21$14.84348,16312/31/20162.49%3.97%
+PLCM04/15/2016Mitel Networks Corporation (MITL)Cash Plus Stock$1.96 billlion$11.24$10.971,452,23009/30/20162.48%6.61%
+IMS05/03/2016Quintiles Transnational Holdings Inc. (Q)All Stock$9 billion$25.24$24.683,194,48812/31/20162.29%3.64%
+WIBC12/07/2015BBCN Bancorp, Inc. (BBCN)All Stock$1 billion$10.54$10.33235,95106/30/20162.00%16.25%
+YCB05/03/2016WesBanco Inc. (WSBC)Cash Plus Stock$221 million$38.17$37.449,06812/31/20161.96%3.12%
+NTI12/21/2015Western Refining, Inc. (WNR)Cash Plus StockN/A$21.49$21.11733,56306/30/20161.78%14.43%
+HTS04/11/2016Annaly Capital Management, Inc. (NLY)All Stock$1.5 billion$16.82$16.56554,93009/30/20161.60%4.26%
+PNX09/29/2015Nassau Reinsurance Group Holdings L.P. (N/A)All Cash$217.2 million$37.50$36.9128,13106/30/20161.60%12.97%
+UNTD05/04/2016B. Riley Financial, Inc. (RILY)All Cash$170 million$11.00$10.84176,14909/30/20161.48%3.93%
+FNFG10/30/2015KeyCorp. (KEY)Cash Plus Stock$4.1 billion$10.24$10.092,991,89209/30/20161.44%3.84%
+FCTY03/10/2016Midland Financial Co. (N/A)All CashN/A$11.22$11.0733,15712/31/20161.36%2.16%
+RRM02/26/2016SES (N/A)All Cash$242 million$13.29$13.12108/15/20161.30%5.20%
+EDE02/09/2016Algonquin Power & Utilities Corp. (AQN.TO)All Cash$2.4 billion$34.00$33.57307,18503/31/20171.28%1.47%
+CVT04/18/2016affiliates of Vista Equity Partners (N/A)All Cash$1.65 billion$36.00$35.56628,93109/30/20161.24%3.30%
+SSRG05/03/2016an affiliate of RoundTable Healthcare Partners (N/A)All Cash$140.3 million$13.10$12.9539,24809/30/20161.16%3.09%
+CVC09/17/2015Altice (N/A)All Cash$17.7 billion$34.90$34.603,001,55606/30/20160.87%7.03%
+AVNU01/29/2016Pinnacle Financial Partners Inc. (PNFP)Cash Plus Stock$201.4 million$18.75$18.595,47909/15/20160.85%2.53%
+KLAC10/21/2015Lam Research Corporation (LRCX)Cash Plus Stock$10.6 billion$69.17$68.60621,98406/30/20160.83%6.74%
+FMER01/26/2016Huntington Bancshares Incorporated (HBAN)Cash Plus Stock$3.4 billion$21.63$21.47855,39009/30/20160.76%2.02%
+FCS11/18/2015ON Semiconductor Corp. (ON)All Cash$2.4 billion$20.00$19.86409,71705/26/20160.70%25.73%
+PKY04/29/2016Cousins Properties Incorporated (CUZ)All Stock$1.95 billion$17.34$17.24946,65812/31/20160.60%0.95%
+RKUS04/04/2016Brocade Communications Systems, Inc. (BRCD)Cash Plus Stock$1.2 billion$12.39$12.33988,42107/31/20160.49%2.34%
+CKEC03/03/2016AMC Entertainment Holdings, Inc. (AMC)All Cash$1.1 billion$30.00$29.86219,45312/31/20160.47%0.75%
+GAS08/24/2015Southern Company (SO)All Cash$12 billion$66.00$65.77703,50312/31/20160.35%0.56%
+TUMI03/03/2016Samsonite International S.A. (N/A)All Cash$1.8 billion$26.75$26.66863,33406/30/20160.34%2.74%
+MNRK12/17/2015Towne Bank (TOWN)All Stock$221 million$18.07$18.0114,35606/30/20160.31%2.53%
+TWC05/26/2015Charter Communications, Inc. (CHTR)Cash Plus Stock$78.7 billion$216.07$215.5111,085,91105/18/20160.26%47.11%
+OPWR05/02/2016Oracle Corporation (ORCL)All Cash$532 million$10.30$10.28976,82512/31/20160.19%0.31%
+MEG01/27/2016Nexstar Broadcasting Group, Inc. (NXST)Special Conditions$4.6 billion$17.14$17.12680,30712/15/20160.12%0.20%
+TE09/05/2015Emera (N/A)All Cash$10.4 billion$27.55$27.522,759,74606/30/20160.11%0.88%
+CKP03/02/2016an affiliate of CCL Industries Inc. (N/A)All Cash$443 million$10.15$10.143,639,38809/30/20160.10%0.26%
+PNY10/26/2015Duke Energy Corporation (DUK)All Cash$6.7 billion$60.00$59.95385,69812/31/20160.08%0.13%
+SLI04/07/2016Handy & Harman Ltd. (HNH)All Cash$166.32 million$40.00$39.976,77105/20/20160.08%6.85%
+ARG11/17/2015Air Liquide (N/A)All Cash$13.4 billion$143.00$142.942,106,65908/15/20160.04%0.17%
+CPGX03/17/2016TransCanada Corporation (TRP)All Cash$13 billion$25.50$25.494,131,08112/31/20160.04%0.06%
+IHS03/21/2016Markit Ltd. (MRKT)All StockN/A$119.86$119.82230,99112/31/20160.03%0.05%
+EXAM04/27/2016an affiliate of Leonard Green & Partners, L.P. (N/A)All Cash$2.2 billion$35.05$35.05306,96709/30/20160.00%0.00%
+HNSN04/20/2016Auris Surgical Robotics (N/A)All Cash$80 million$4.00$4.0026,15806/30/20160.00%0.00%
+TXTR04/28/2016Oracle Corporation (ORCL)All Cash$663 million$26.00$26.01778,88412/31/2016-0.04%-0.06%
+AFOP04/07/2016Corning Inc. (GLW)All Cash$305 million$18.50$18.51281,77706/30/2016-0.05%-0.44%
+RSE02/25/2016an affiliate of Brookfield Asset Management Inc. (N/A)All Cash$2.8 billion$18.25$18.27354,14609/30/2016-0.11%-0.29%
+WCN01/19/2016Progressive Waste Solutions Ltd. (BIN)All StockN/A$69.51$69.74459,73306/30/2016-0.33%-2.65%
+STR02/01/2016Dominion Resources, Inc. (D)All Cash$4.4 billion$25.00$25.112,409,55012/31/2016-0.44%-0.70%
+KKD05/09/2016JAB Beech Inc. (N/A)All Cash$1.35 billion$21.00$21.141,842,85109/30/2016-0.66%-1.76%
+HE12/03/2014NextEra Energy, Inc. (NEE)Special Conditions$4.3 billion$33.50$33.80283,58506/30/2016-0.89%-7.20%
+ALXA05/10/2016Grupo Ferrer Internacional, S.A. (N/A)Special ConditionsN/A$0.90$0.91207,03606/30/2016-1.10%-8.91%
+CHEV11/24/2015MainSource Financial Group, Inc. (MSFG)All Stock$107.4 million$14.59$14.8294909/30/2016-1.53%-4.09%
+COB11/23/2015Capital Bank Financial Corp. (CBF)All Stock$350 million$12.66$12.9019,03206/30/2016-1.83%-14.87%
+FXCB12/08/2015Univest Corporation of Pennsylvania (UVSP)All Stock$244.3 million$18.98$19.566,55809/30/2016-2.99%-7.96%
+LPSB03/10/2016Horizon Bancorp (HBNC)All Stock$94.1 million$15.07$15.802,25509/30/2016-4.61%-12.30%
+BITI01/19/2016Acorda Therapeutics, Inc. (ACOR)All Cash$363 million$25.60$26.853,25909/30/2016-4.66%-12.40%
+FSYS09/01/2015Westport Innovations Inc. (WPRT)All Stock$126.36 million$4.30$4.9522,54406/30/2016-13.12%-106.41%
+CACQ12/22/2014Caesars Entertainment Corporation (CZR)All StockN/A$4.61$8.7169,97003/31/2015-47.09%41.72%

Disclaimer: Clients of Signal Partners, LLC  and I may have positions in any of these stocks at any time. Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

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