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Merger Arbitrage Mondays – June 26, 2017

  • June 25, 2017

Merger activity increased last week with five new deals announced and five 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 four new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017100
Total Number of Deals Not Completed in 20174
Total Number of Pending Deals
Cash Deals56
Stock Deals21
Stock & Cash Deals12
Special Conditions8
Total Number of Pending Deals97
Total Deal Size$821.28 billion

New Deals:

  1. The acquisition of Rice Energy (RICE) by EQT Corporation (EQT) for $8.2 billion in a cash plus stock deal. Under the terms of the agreement, shareholders of Rice Energy will receive 0.37 shares of EQT common stock and $5.30 in cash per share of Rice common stock.
  2. The acquisition of Novadaq Technologies (NVDQ) by Stryker Corporation (SYK) for $701 million or $11.75 per share in cash.
  3. The acquisition of PAREXEL International Corporation (PRXL) by Pamplona Capital Management for $5 billion or $88.10 per share in cash.
  4. The acquisition of ARI Network Services (ARIS) by an affiliate of True Wind Capital Management for $140 million or $7.10 per share in cash.
  5. The acquisition of EnerNOC (ENOC) by Enel Green Power North America for $300 million or $7.67 per share in cash.

Deal Updates:

  1. On June 23, 2017, Caesars Entertainment Corporation (CZR) and Caesars Acquisition Company (CACQ) announced that the Securities and Exchange Commission has declared effective the Registration Statement on Form S-4 previously filed by Caesars Entertainment on March 13, 2017, and amended on June 5, 2017 and June 20, 2017. Caesars Entertainment and Caesars Acquisition also announced that they have individually scheduled special meetings of Caesars Entertainment and Caesars Acquisition stockholders on July 25, 2017 in connection with the pending Merger. We are extending the closing date for this deal to July 31, 2017.
  2. On June 23, 2017, Norsat International (NSAT) announced that at the adjourned 2017 annual general and special meeting of securityholders of Norsat held on June 22, 2017, securityholders of Norsat voted in favour of a special resolution to approve the plan of arrangement, pursuant to which Hytera Communications will acquire all the issued and outstanding shares of Norsat.
  3. On June 23, 2017, Forestar Group (FOR) announced that it had received a revised binding proposal from D.R. Horton to acquire 75% of the outstanding shares of Forestar common stock for $17.75 per share in cash and that its board of directors has unanimously determined that the revised proposal constitutes a “Superior Proposal,” as defined in Forestar’s amended merger agreement with Starwood Capital Group. Forestar also announced that it has also entered into a second amendment to its merger agreement with Starwood to increase the merger consideration to $16.00 per share in cash. In accordance with the amended merger agreement with Starwood, Forestar will discuss and negotiate with Starwood in good faith until the end of the business day on June 28, 2017 such adjustments in the terms and conditions of the merger agreement with Starwood as would permit the Forestar board of directors not to terminate the amended merger agreement with Starwood.
  4. On June 23, 2017, Coach (COH) announced that it has extended the expiration of its previously announced tender offer to purchase all of the outstanding shares of common stock, of Kate Spade & Company (KATE) until July 10, 2017, unless further extended or earlier terminated.
  5. On June 24, 2017, The National Farmers Union urged the Federal Trade Commission to oppose the proposed China National Chemical Corp’s acquisition of Syngenta (SYT).

Closed Deals:

  1. The acquisition of Exeter Resource Corporation (XRA) by Goldcorp (GG) on June 20, 2017. It took 84 days for this deal to be completed.
  2. The acquisition of TRC Companies (TRR) by New Mountain Capital on June 21, 2017. It took 81 days for this deal to be completed.
  3. The acquisition of MOCON (MOCO) by AMETEK (AME) on June 22, 2017. It took 66 days for this deal to be completed.
  4. The acquisition of PrivateBancorp (PVTB) by Canadian Imperial Bank of Commerce (CM) on June 23, 2017. It took 359 days for this deal to be completed.
  5. The acquisition of Eastern Virginia Bankshares (EVBS) by Southern National Bancorp of Virginia (SONA) on June 23, 2017. It took 192 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
RAD10/27/2015Walgreens Boots Alliance, Inc. (WBA)$6.50$3.110007/31/2017109.00%1136.75%
GNW10/23/2016China Oceanwide Holdings Group Co., Ltd. (N/A)$5.43$3.7006/30/201746.76%4266.55%
DEST12/20/2016Orchestra-Premaman S.A. (KAZI.PA)$5.86$4.4210/31/201732.48%93.35%
LSCC11/03/2016Canyon Bridge Capital Partners, Inc. (N/A)$8.30$6.6506/30/201724.81%2264.10%
WR05/31/2016Great Plains Energy Incorporated (GXP)$60.00$53.110006/30/201712.97%1183.79%
MON09/14/2016Bayer AG (BAYRY)$128.00$117.0212/31/20179.38%18.22%
TWX10/22/2016AT&T, Inc. (T)$107.50$99.7012/31/20177.82%15.19%
CAB10/03/2016Bass Pro Shops (N/A)$61.50$57.390009/30/20177.16%27.23%
SGBK03/27/2017Home Bancshares, Inc. (HOMB)$49.00$45.9712/31/20176.59%12.80%
WGL01/25/2017AltaGas Ltd. (N/A)$88.25$83.4506/30/20185.75%5.69%

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 Whole Foods (WFM), Cabela’s (CAB), Rite Aid (RAD) and Fortress Investment Group (FIG). 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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