Merger Arbitrage Mondays – May 29, 2017

Merger activity increased last week with five new deals announced and three 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 was one new deal announced in the Deals in the Works section.

Deal Statistics:

New Deals:

1. The acquisition of Nutraceutical International Corporation (NUTR) by an affiliate of HGGC for $446 million or $41.80 per share in cash.
2. The acquisition of Huntsman Corporation (HUN) by CLARIANT N (CLN.VX) for $6.72 billion. Huntsman shareholders receive 1.2196 shares in HuntsmanClariant for each Huntsman share (each existing Clariant share will remain outstanding as a share in HuntsmanClariant).
3. The acquisition of Xenith Bankshares (XBKS) by Union Bankshares Corporation (UBSH) for $701.2 million in an all stock deal. Under the terms of the merger agreement, each outstanding share of Xenith common stock will be converted into the right to receive 0.9354 shares of Union common stock.
4. Sonus Networks (SONS) and GENBAND announced a definitive agreement under which the two companies will combine under a newly formed holding company. Sonus and GENBAND shareholders will each own approximately 50% of the combined company. The transaction values the combined company at an enterprise value of approximately $745 million. Under the terms of the agreement, each Sonus shareholder will receive one share of common stock in the combined company for each existing Sonus share they own. We are not adding this deal to our database as the transaction values can be determined only after the new company is formed.
5. The acquisition of Global Sources (GSOL) by Expo Holdings. Under the terms of the agreement, each issued and outstanding common share of Global Sources will be automatically cancelled and converted into the right to receive an amount equal to US$18.00.
6. The acquisition of Fidelity & Guaranty Life (FGL) by CF Corporation (CFCO) for $1.835 billion or $31.10 per share in cash.

Deal Updates:

1. On May 24, 2017, Stonegate Mortgage Corporation (SGM)  entered into a Letter Agreement. Pursuant to the Letter Agreement, the Parties agreed to the satisfaction of certain closing conditions of the Parties required under Article VII of the Merger Agreement as of May 24, 2017, and agreed to a closing date for the Merger of May 31, 2017.
2. On May 24, 2017, Cascade Bancorp (CACB) and First Interstate BancSystem (FIBK) announced that each of its shareholders have approved the proposed merger of Cascade with and into First Interstate. The merger is expected to close on May 30, 2017, subject to satisfaction of customary closing conditions.
3. On May 24, 2017, Western Refining (WNR) announced that the waiting period applicable to its proposed acquisition by Tesoro Corporation (TSO) pursuant to the Hart Scott Rodino Act has terminated. This satisfies one of the final conditions to the closing of the pending acquisition. Western Refining therefore expects the closing of the acquisition to occur on June 1, 2017, subject to the satisfaction or waiver of the remaining customary conditions to closing.
4. On May 24, 2017, Lumos Networks (LMOS) announced that, at the Lumos Networks Annual Meeting of Stockholders, Lumos Networks stockholders approved the merger agreement with EQT Infrastructure investment strategy.
5. On May 24, 2017, The Kansas Corporation Commission denied the Petition for Reconsideration filed jointly by Great Plains Energy Incorporated (GXP) and Westar Energy (WR) regarding the Commission’s April 19, 2017, Order denying approval of Great Plains Energy’s acquisition of Westar Energy.
6. On May 25, 2017, Global Sources (GSOL) announced that the Company and Expo Holdings II have entered into an amendment to the previously announced Agreement and Plan of Amalgamation providing for an increase in the amalgamation consideration from US$18.00 per share in cash to US$20.00 per share in cash.
7. On May 25, 2017, Royal Bancshares of Pennsylvania (RBPAA) announced that its shareholders approved its pending merger transaction with Bryn Mawr Bank Corporation (BMTC) at a special meeting of shareholders held on May 24, 2017.
8. On May 25, 2017, Norsat International (NSAT) announced an amended offer from Hytera Communicationsa to be acquired for $11.25 USD per share.
9. On May 26, 2017, The Sherwin-Williams Company (SHW) announced that it has received regulatory approval from the United States Federal Trade Commission and the Canadian Competition Bureau to complete its acquisition of The Valspar Corporation (VAL). The FTC and CCB were the only remaining regulatory approvals required to close the acquisition. Sherwin-Williams expects to close the acquisition on June 1, 2017, subject to customary closing conditions.

Closed Deals:

1. The acquisition of RetailMeNot (SALE) by Harland Clarke Holdings on May 23, 2017. It took 43 days for this deal to be completed.
2. The acquisition of Georgetown Bancorp (GTWN) by Salem Five Bancorp on May 23, 2017. It took 229 days for this deal to be completed.
3. The acquisition of Ultratech (UTEK) by Veeco Instruments (VECO) on May 26, 2017. It took 113 days for this deal to be completed.

Top 10 deals with largest spreads:

List of all pending deals:

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

Disclaimer: I hold positions in Cabela’s (CAB), Rite Aid (RAD), 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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