Merger Arbitrage Mondays – August 27, 2018
Merger activity remained unchanged last week with three new deals announced and five 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:
New Deals:
- The acquisition of SodaStream International (SODA) by PepsiCo (PEP) for $3.2 billion or $144 per share in cash. PepsiCo paid a 32% premium to the 30-day volume weighted average price of SodaStream and this was after the stock had already doubled over the prior two years. The acquisition reminds me of Coca-Cola acquiring a stake in Keurig Green Mountain (GMCR) and GMCR’s eventual acquisition by JAB Holding for a fat premium of almost 78%. Both SODA and GMCR were heavily shorted stocks at various times over the last few years and are reminders that even if the short thesis is valid, acquisitions like these are a big risk for short sellers.
- The acquisition of The Navigators Group (NAVG) by The Hartford Financial Services Group (HIG) for $2.1 billion or $70 per share in cash.
- The acquisition of Spectra Energy Partners (SEP) by Enbridge (ENB) for $3.3 billion in an all stock deal. Under the terms of the agreement, Enbridge will acquire all of the outstanding public common units of SEP on the basis of 1.111 common shares of Enbridge for each common unit of SEP. We added SEP as a potential deal to the Deals in the Works section on May 18, 2018 and the price after the news of the potential deal came out was $31.03.
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