Merger Arbitrage Mondays – December 12, 2016

Merger Activity increased last week with three new deals announced and six 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 2016 220
Total Number of Deals Not Completed in 2016 19
Total Number of Pending Deals
Cash Deals 50
Stock Deals 17
Stock & Cash Deals 11
Special Conditions 7
Total Number of Pending Deals 85
Total Deal Size $1383.92 billion

New Deals:

  1. The acquisition of Fairpoint Communications (FRP) by Consolidated Communications Holdings (CNSL) for $1.5 billion in an all stock deal. Under the terms of the agreement, FairPoint shareholders will receive a fixed exchange ratio of 0.7300 shares of Consolidated Communications common stock for each share of FairPoint common stock.
  2. The acquisition of IntraLinks Holdings (IL) by Synchronoss Technologies (SNCR) for $821 million or $13.00 per share in cash.
  3. The acquisition of Stillwater Mining Company (SWC) by Sibanye Gold Limited (SBGL) for $2.2 billion or $18.00 per share in cash.

Deal Updates:

  1. On December 6, 2016, A U.S. Justice Department attorney told a federal judge on Monday that health insurer Aetna’s (AET) planned acquisition of Humana (HUM) would break antitrust law by reducing competition in Medicare Advantage and Obamacare exchange businesses, kicking off a trial expected to last weeks. On December 8, 2016, The Justice Department hammered away in court at the viability of a plan by Aetna and Humana to sell off assets to alleviate antitrust concerns about their proposed $34 billion merger.
  2. On December 7, 2016, Alere (ALR), issued a statement in response to a lawsuit filed by Abbott Laboratories (ABT) in the Delaware Court of Chancery to terminate Abbott’s pending merger agreement with Alere. On December 8, 2016, Abbott Laboratories fired the latest salvo in its legal battle with Alere over their $5.8 billion buyout agreement, suing the troubled Waltham diagnostics firm in an effort to terminate the deal.
  3. On December 7, 2016, PrivateBancorp (PVTB) postponed a shareholder vote due Thursday on a proposed takeover by Canadian Imperial Bank of Commerce (CM), raising doubts about whether the deal will proceed.
  4. On December 8, 2016, Alaska Airlines said  that it has agreed to settle a lawsuit brought by consumers opposing its $2.6 billion merger with Virgin America (VA). The lawsuit was a barrier to the merger, which won antitrust approval on Tuesday, under some conditions.
  5. On December 8, 2016, China’s Fujian Grand Chip Investment Fund dropped its takeover bid for chip equipment maker Aixtron (AIXG) after the United States blocked the deal on security grounds.
  6. On December 9, 2016, Intersil Corporation (ISIL), announced that Intersil stockholders approved the merger agreement with Renesas Electronics Corporation.
  7. On December 9, 2016, Actions Semiconductor (ACTS) announced that the Company’s shareholders voted in favor of, among others, the proposal to authorize and approve the previously announced agreement and plan of merger dated September 12, 2016, among the Company and a consortium of investors.

Closed Deals:

  1. The acquisition of SunEdison Semiconductor Limited (SEMI) by GlobalWafers on December 2, 2016. It took 107 days for this deal to be completed.
  2. The acquisition of Ingram Micro (IM) by Tianjin Tianhai Investment Company on December 6, 2016. It took 293 days for this deal to be completed.
  3. The acquisition of Talen Energy Corporation (TLN) by affiliates of Riverstone Holdings on December 6, 2016. It took 186 days for this deal to be completed. It took 46 days for this deal to be completed.
  4. The acquisition of Everyday Health (EVDY) by j2 Global (JCOM) on December 6, 2016.
  5. The acquisition of LinkedIn Corporation (LNKD) by Microsoft Corporation (MSFT) on December 8, 2016. It took 178 days for this deal to be completed.
  6. The acquisition of Starz (STRZA) by Lions Gate Entertainment (LGF) on December 9, 2016. It took 162 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annualized
Profit
ALR 02/01/2016 Abbott Laboratories (ABT) $56.00 $37.58 12/31/2016 49.02% 941.61%
CI 07/24/2015 Anthem, Inc. (ANTM) $178.56 $134.80 03/31/2017 32.46% 108.70%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.22 06/30/2017 28.67% 52.33%
MON 09/14/2016 Bayer AG (BAYRY) $128.00 $104.59 12/31/2017 22.38% 21.28%
SYT 02/03/2016 ChemChina (N/A) $96.01 $80.44 01/05/2017 19.36% 294.37%
LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) $8.30 $7.02 03/31/2017 18.23% 61.06%
TSL 08/01/2016 Investor consortium comprising Mr. Gao and other entities. (N/A) $11.60 $9.82 03/31/2017 18.10% 60.62%
ADGE 11/02/2016 Tecogen Inc. (TGEN) $0.36 $0.31 06/30/2017 17.52% 31.98%
HUM 07/03/2015 Aetna Inc. (AET) $232.96 $203.29 12/31/2016 14.60% 280.40%
SYUT 11/17/2016 Beams Power Investment Limited (N/A) $6.05 $5.30 03/31/2017 14.15% 47.39%

List of all pending deals:

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

Disclaimer: I hold long positions in WhiteWave Foods (WWAV), Apollo Education (APOL), Rite Aid (RAD) and Syngenta (SYT). 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.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria or follow me on Twitter@asifsuria

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