Merger Arbitrage Mondays – October 23, 2017

  • October 23, 2017

Merger activity increased last week with three new deals announced and three pending 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 no new deals announced in the Deals in the Works section.

Deal Statistics:

Total Number of Deals Closed in 2017182
Total Number of Deals Not Completed in 201710
Total Number of Pending Deals
Cash Deals35
Stock Deals18
Stock & Cash Deals9
Special Conditions9
Total Number of Pending Deals71
Total Deal Size$921.87 billion

New Deals:

  1. The acquisition of Ruby Tuesday (RT) by a fund managed by NRD Capital for $335 million or $2.40 per share in cash.
  2. The acquisition of NewStar Financial (NEWS) by First Eagle Investment Management for $3.4 billion. Under the terms of the agreement, the NewStar stockholders will receive $11.44 in upfront cash and one non-transferable contingent value right (CVR) for each NewStar share held at the closing of the transaction. NewStar estimates these refunds to total $1.00 per share if the transaction closes in 2017 or $0.88 per share if the transaction closes in 2018. NewStar stockholders are expected to receive total consideration estimated at $12.32 to $12.44 per share.
  3. On October 20, 2017, EnerJex Resources (ENRJ) announced that it has entered into a definitive Merger Agreement with AgEagle Aerial Systems. Under the terms of the agreement, EnerJex’s Common and Series A Preferred shareholders will own approximately 15% of the combined company. We are not adding this deal to our database since this merger will lead to the creation of a new company.

Deal Updates:

  1. On October 12, 2017, Broadcom, Brocade and ARRIS withdrew and re-filed their joint voluntary notice to CFIUS with respect to the Transaction (the “Transaction Notice”) since completion of the Transaction is predicated upon completion of the Merger and the Parties wish to more closely align the review timetables for these two CFIUS cases. Similar to the Merger Notice, CFIUS has agreed to proceed directly to a 45-day investigation period with respect to the Transaction Notice. To allow for the additional CFIUS review period, on October 16, 2017, the Company and Seller entered into an amendment to the Agreement (the “Amendment”) to extend the end date of the Agreement until December 15, 2017.
  2. On October 17, 2017, Union Bankshares Corporation (UBSH) and Xenith Bankshares (XBKS) jointly announced the receipt of regulatory approval from the Federal Reserve Bank of Richmond and from the Virginia State Corporation Commission to move forward with the proposed merger of Xenith into Union.  The proposed merger remains subject to approval by shareholders of Union and Xenith.
  3. On October 19, 2017, Tribune Media Company (TRCO) announced that at a special meeting, the stockholders of the Company voted overwhelmingly to approve the previously announced acquisition of the Company by Sinclair Broadcast Group (SBGI).

Closed Deals:

  1. The acquisition of Wolverine Bancorp (WBKC) by Horizon Bancorp (HBNC) on October 17, 2017. It took 125 days for this deal to be completed.
  2. The acquisition of Landauer (LDR) by Fortive Corporation (FTV) on October 19, 2017. It took 43 days for this deal to be completed.
  3. The acquisition of Southwest Bancorp (OKSB) by Simmons First National Corporation (SFNC) on October 20, 2017. It took 310 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
GNW10/23/2016China Oceanwide Holdings Group Co., Ltd. (N/A)$5.43$3.8112/31/201742.52%224.92%
MGI01/26/2017Ant Financial Services Group (N/A)$18.00$15.7412/31/201714.36%75.95%
YUME09/05/2017RhythmOne plc (RTHM.L)$4.74$4.2303/31/201811.97%27.48%
NXTM08/07/2017Fresenius Medical Care (N/A)$30.00$27.5106/30/20189.05%13.21%
BRCD11/02/2016Broadcom Limited (AVGO)$12.75$11.9012/15/20177.14%49.19%
SNI07/31/2017Discovery Communications, Inc. (DISCK)$90.00$84.5003/31/20186.51%14.94%
TWX10/22/2016AT&T, Inc. (T)$107.50$101.8312/31/20175.57%29.45%
HUN05/22/2017CLARIANT N (CLN.VX)$30.39$28.9712/31/20174.90%25.92%
MON09/14/2016Bayer AG (BAYRY)$128.00$122.1501/31/20184.79%17.48%
CBMX07/31/2017Invitae Corporation (NVTA)$8.33$7.9512/31/20174.78%25.28%

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 Fortress Investment Group (FIG) and CombiMatrix (CBMX). 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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