Merger Arbitrage Mondays – December 18, 2017

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

Deal Statistics:

New Deals:

1. The acquisition of Repros Therapeutics (RPRX) by Allergan (AGN) for $13.26 million or $0.67 per share in cash.
2. The acquisition of FNB Bancorp (FNBG) by TriCo Bancshares (TCBK) for $315.3 million in an all stock deal. Under the terms of the merger agreement, FNB shareholders will receive 0.980 shares of TriCo common stock in exchange for each share of FNB common stock they hold. The merger agreement includes a trading collar that allows TriCo to terminate the merger agreement if the weighted average price of TriCo common stock, determined in accordance with the merger agreement, exceeds $49.78 and outperforms the KBW Regional Banking Index by more than 20%, unless FNB agrees to reduce the exchange ratio. Conversely, FNB has the right to terminate the merger agreement if the weighted average price of TriCo common stock is less than $33.18 and underperforms the KBW Regional Banking Index by more than 20%, unless TriCo agrees to increase the exchange ratio.
3. The acquisition of Twenty-First Century Fox (FOX) by The Walt Disney Company (DIS) for $66.1 billion. Under the terms of the agreement, shareholders of 21st Century Fox will receive 0.2745 Disney shares for each 21st Century Fox share they hold. The per share consideration is subject to adjustment for certain tax liabilities arising from the spinoff and other transactions related to the acquisition. The initial exchange ratio of 0.2745 Disney shares for each 21st Century Fox share was set based on an estimate of such tax liabilities to be covered by an $8.5 billion cash dividend to 21st Century Fox from the company to be spun off. The exchange ratio will be adjusted immediately prior to closing of the acquisition based on an updated estimate of such tax liabilities. Such adjustment could increase or decrease the exchange ratio, depending upon whether the final estimate is lower or higher, respectively, than the initial estimate. However, if the final estimate of the tax liabilities is lower than the initial estimate, the first $2 billion of that adjustment will instead be made by net reduction in the amount of the cash dividend to 21st Century Fox from the company to be spun off. The amount of such tax liabilities will depend upon several factors, including tax rates in effect at the time of closing as well as the value of the company to be spun off.

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