Merger Arbitrage Mondays – April 10, 2017

Merger activity remained steady last week with six new deals announced and six deals closing. You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.

There were two new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017 55
Total Number of Deals Not Completed in 2017 2
Total Number of Pending Deals
Cash Deals 50
Stock Deals 17
Stock & Cash Deals 10
Special Conditions 8
Total Number of Pending Deals 85
Total Deal Size $678.29 billion

New Deals:

  1. The acquisition of Syneron Medical (ELOS) by funds advised by Apax Partners for $397 million or $11.00 per share in cash.
  2. The acquisition of General Communication (GNCMA) by Liberty Ventures (LVNTA) for $2.68 billion. Under the terms of the agreement, shareholders of GCI will receive total consideration of $32.50 per share comprised of $27.50 per share in GCI Liberty Class A common stock and $5.00 in newly issued Series A preferred shares, based on a Liberty Ventures reference price of $43.65.
  3. The acquisition of Panera Bread Company (PNRA) by JAB for $7.5 billion or $315 per share in cash.
  4. The acquisition of Innocoll Holdings (INNL) by Gurnet Point for $209 million. Under the recommended offer, Gurnet Point will acquire Innocoll for $1.75 per share in cash, and up to $4.90 in cash from a contingent value right (CVR), for a total potential per share value of up to $6.65 or up to approximately $209 million in aggregate. We are entering this deal as a “Special Conditions” deal with a value of $1.75 and are not assigning a value to the CVR because it is both difficult and highly subjective. We did attempt to put a value on the CVR of another deal (Tobira Therapeutics) and you can check it out here.
  5. The acquisition of CU Bancorp (CUNB) by PacWest Bancorp (PACW) for $705 million in a cash plus stock deal. Under terms of the Agreement, CU Bancorp shareholders will receive 0.5308 shares of PacWest common stock and $12.00 in cash for each share of CU Bancorp.
  6. The acquisition of Zhaopin Limited (ZPIN) by SEEK International Investments for $678.59 million. Under the terms of the agreement, SEEK International Investments will acquire all of the outstanding shares of Zhaopin for cash consideration, that together with the amount of the Special Dividend will equal US$9.10 per ordinary share of the Company and US$18.20 per American Depositary Share of the Company, each representing two Shares. Holders of Shares and ADSs as of immediately prior to the Effective Time will be entitled to receive a cash special dividend, which, will be a minimum US$0.28 and maximum US$1.35 per Share (corresponding with a minimum US$0.56 and maximum US$2.70 per ADS), which will be paid to such shareholders and ADS holders as promptly as practicable following the Effective Time.

Deal Updates:

  1. On March 31, 2017, The WhiteWave Foods Company (WWAV) and Danone achieved a major milestone towards the completion of the planned merger of the two companies with the reaching of an agreement in principle with the Antitrust Division of the United States Department of Department of Justice.
  2. On April 4, 2017, ChemChina and Syngenta (SYT) announced that they have received approval from the US Federal Trade Commission for the proposed acquisition of Syngenta by ChemChina. This represents a major step towards the closing of the transaction, which is expected to take place in the second quarter of 2017.
  3. On April 4, 2017, CEB (CEB) announced that CEB shareholders approved the definitive merger agreement with Gartner. CEB and Gartner expect to complete the transaction on April 5, 2017.
  4. On April 4, 2017, Qualcomm Incorporated (QCOM) announced that Qualcomm River Holdings an indirect wholly owned subsidiary of Qualcomm, has extended the offering period of its previously announced cash tender offer to purchase all of the outstanding common shares of NXP Semiconductors (NXPI). The tender offer is now scheduled to expire on May 2, 2017, unless extended or earlier terminated, in either case pursuant to the terms of the Purchase Agreement.
  5. On April 4, 2017, Qualcomm (QCOM) has received approval from U.S. antitrust regulators for its proposed $47 billion acquisition of NXP Semiconductors (NXPI).
  6. On April 5, 2017, Reynolds American (RAI) announced that British American Tobacco (BTI) has obtained unconditional antitrust approval from the Japanese authorities in relation to its proposed acquisition of RAI.
  7. On April 6, 2017, ChemChina won conditional EU antitrust approval for its $43 billion bid for Syngenta (SYT).
  8. On April 6, 2017, The U.S. District Court for the District of Columbia signed an order allowing The WhiteWave Foods Company (WWAV) and Danone to complete the planned merger of the two companies. WhiteWave expects the closing of Danone’s acquisition of WhiteWave to occur within five business days from the date of the Court’s order on April 5, 2017.
  9. On April 7, 2017, United Bankshares (UBSI) shareholders approved the acquisition of Cardinal Financial Corporation (CFNL). Shareholder approval followed regulatory approval by the Board of Governors of the Federal Reserve System and the Virginia Bureau of Financial Institutions. The companies expect to complete the transaction on April 21, 2017.
  10. On April 7, 2017, Pinnacle Financial Partners (PNFP) and BNC Bancorp (BNCN) announced that Pinnacle has received approvals of its applications to merge with BNC from the Federal Reserve Bank of Atlanta, the Tennessee Department of Financial Institutions and the North Carolina Office of the Commissioner of Banks. Accordingly, all banking regulatory approvals required for consummation of the proposed mergers have been received.

Closed Deals:

  1. The acquisition of Suffolk Bancorp (SCNB) by People’s United Financial (PBCT) on April 3, 2017. It took 281 days for this deal to be completed.
  2. The acquisition of Middleburg Financial Corporation (MBRG) by Access National Corporation (ANCX) on April 3, 2017. It took 161 days for this deal to be completed.
  3. The acquisition of GigPeak (GIG) by Integrated Device Technology (IDTI) on April 4, 2017. It took 50 days for this deal to be completed.
  4. The acquisition of CEB (CEB) by Gartner on April 5, 2017. It took 90 days for this deal to be completed. (update the filing url)
  5. The acquisition of Joy Global (JOY) by Komatsu America on April 5, 2017. It took 258 days for this deal to be completed.
  6. The acquisition of Metaldyne Performance Group (MPG) by American Axle & Manufacturing Holdings (AXL) on April 6, 2017. It took 154 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol Announced
Profit Annualized
RAD 10/27/2015 Walgreens Boots Alliance, Inc. (WBA) $6.50 $4.60 07/31/2017 41.30% 134.61%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.04 06/30/2017 34.41% 155.04%
ALR 02/01/2016 Abbott Laboratories (ABT) $56.00 $43.05 03/31/2017 30.08% -1097.97%
CAB 10/03/2016 Bass Pro Shops (N/A) $65.50 $52.96 06/30/2017 23.68% 106.70%
LSCC 11/03/2016 Canyon Bridge Capital Partners, Inc. (N/A) $8.30 $6.90 03/31/2017 20.29% -740.58%
WR 05/31/2016 Great Plains Energy Incorporated (GXP) $60.00 $54.32 06/30/2017 10.46% 47.12%
MON 09/14/2016 Bayer AG (BAYRY) $128.00 $116.16 12/31/2017 10.19% 14.04%
ADGE 11/02/2016 Tecogen Inc. (TGEN) $0.35 $0.3162 06/30/2017 9.69% 43.67%
TWX 10/22/2016 AT&T, Inc. (T) $107.50 $98.46 12/31/2017 9.18% 12.65%
GLBL 03/07/2017 Brookfield Asset Management Inc. (BAM) $5.10 $4.725 12/31/2017 7.94% 10.93%

List of all pending deals:

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

Disclaimer: I hold positions in WhiteWave Foods (WWAV), Rite Aid (RAD), Syngenta (SYT), Fortress Investment Group (FIG) and NXP Semiconductors (NXPI). 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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