Merger Arbitrage Mondays – January 14, 2019

Merger activity increased last week with three new deals announced and seven 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:

Total Number of Deals Closed in 2019 13
Total Number of Pending Deals
Cash Deals 37
Stock Deals 22
Stock & Cash Deals 15
Special Conditions 4
Total Number of Pending Deals 78
Total Deal Size $559.28 billion

New Deals:

  1. The acquisition of Luxoft Holding (LXFT) by DXC Technology Company (DXC) for $2 billion or $59.00 per share in cash.
  2. The acquisition of Loxo Oncology (LOXO) by Eli Lilly and Company (LLY) for $8 billion or $235 per share in cash.
  3. The acquisition of HopFed Bancorp (HFBC) by First Financial Corporation (THFF) for $128.3 million. Under the terms of the merger agreement, stockholders of HFBC may elect to receive either 0.444 shares of First Financial common stock or $21.00 in cash for each share of HFBC common stock owned.

Deal Updates:

  1. On January 8, 2019, Tahoe Resources (TAHO) announced that the shareholders of Tahoe overwhelmingly voted in favour of the proposed transaction whereby Pan American Silver will acquire all of the issued and outstanding shares of Tahoe.
  2. On January 9, 2019, Americas Silver Corporation (USAS) and Pershing Gold Corporation (PGLC) are pleased to announce that their respective shareholders have provided the requisite approvals in respect of the previously announced business combination transaction between the two companies.
  3. On January 9, 2019, SJW Group (SJW) and Connecticut Water Service (CTWS) announced that they are continuing to evaluate their regulatory approach – including the possibility of submitting a new application to the Connecticut Public Utilities Regulatory Authority – in connection with their proposed merger. Pending this review, they have withdrawn their current application before PURA.
  4. On January 10, 2019, Bojangles’ (BOJA) announced that, the Company’s stockholders voted to adopt the merger agreement pursuant to which the Company would be acquired by Durational Capital Management and The Jordan Company.
  5. On January 10, 2019, Electro Scientific Industries (ESIO), announced that ESI shareholders voted to approve the previously announced definitive merger agreement with MKS Instruments (MKSI).
  6. On January 11, 2019, Nevsun Resources (NSU) and Zijin Mining Group announced that the Offeror has mailed a notice of compulsory acquisition to all the Remaining Shareholders in accordance with the compulsory acquisition provisions in the Business Corporations Act (British Columbia).
  7. On January 11, 2019, Science Applications International Corporation (SAIC) and Engility Holdings (EGL) announced that stockholders of each SAIC and Engility overwhelmingly approved their respective proposals related to the proposed merger of SAIC and Engility.
  8. On January 11, 2019, Genworth Financial (GNW) and China Oceanwide Holdings Group announced that the Virginia State Corporation Commission, Bureau of Insurance, reapproved the proposed acquisition of control by Oceanwide of Genworth’s Virginia-domiciled insurance companies, Genworth Life and Annuity Insurance Company and Jamestown Life Insurance Company, as contemplated under the merger agreement.
  9. On January 11, 2019, Union Bankshares Corporation and Access National Corporation (ANCX) jointly announced the receipt of regulatory approvals from the Federal Reserve Bank of Richmond and from the Virginia State Corporation Commission to move forward with the proposed merger of Access with and into Union.
  10. On January 11, 2019, Tahoe Resources (TAHO) announced that the Supreme Court of British Columbia issued its final order approving the proposed transaction whereby Pan American Silver will acquire all of the issued and outstanding shares of Tahoe. Subject to the satisfaction or waiver of all conditions precedent to the Arrangement, including receipt of approval from the Mexican Federal Economic Competition Commission, the Arrangement is anticipated to be completed on or about February 26, 2019.
  11. January 11, 2019: As part of the U.S. Department of Justice’s review of the Merger, L3 (LLL) and Harris (HRS) each received on January 10, 2019 a request for additional information and documentary materials from the DOJ, which extends the waiting period under the HSR Act until 30 days after both L3 and Harris have complied with the Second Request or such later time as the parties may agree with the DOJ, unless the waiting period is terminated earlier.  L3 and Harris continue to expect the Merger to close in the previously announced timeframe of mid-calendar year 2019.
  12. On January 11, 2019, Twenty-First Century Fox (FOX) confirmed that it does not intend to bid for any of the Fox regional sports networks that Disney (DIS) (or any entity operating on its behalf) may sell as required by the consent decree with the U.S. Department of Justice.

Closed Deals:

  1. The acquisition of Black Box Corporation (BBOX) by AGC Networks on January 7, 2019. It took 57 days for this deal to be completed.
  2. The acquisition of Shire (SHPG) by Takeda Pharmaceutical Company Limited (TKPYY) on January 8, 2019. It took 245 days for this deal to be completed.
  3. The acquisition of Apptio (APTI) by an affiliate of Vista Equity Partners on January 10, 2019. It took 60 days for this deal to be completed.
  4. The acquisition of Valero Energy Partners (VLP) by Valero Energy Corporation (VLO) on January 10, 2019. It took 84 days for this deal to be completed.
  5. The acquisition of Imperva (IMPV) by Thoma Bravo on January 10, 2019. It took 92 days for this deal to be completed.
  6. The acquisition of EQGP Holdings (EQGP) by Equitrans Midstream Corporation (ETRN) on January 10, 2019. It took 42 days for this deal to be completed.
  7. The acquisition of Intersections (INTX) by WC SACD One Parent on January 11, 2019. It took 72 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annualized
Profit
INUV 11/05/2018 ConversionPoint Technologies, Inc. (N/A) $2.22 $1.156 03/31/2019 92.04% 442.04%
EHIC 04/06/2018 Teamsport Parent Limited (N/A) $13.50 $10.00 03/31/2019 35.00% 168.09%
AVA 07/19/2017 Hydro One Limited (N/A) $53.00 $41.29 03/29/2019 28.36% 139.89%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.80 01/31/2019 13.13% 281.80%
CELG 01/03/2019 Bristol-Myers Squibb Company (BMY) $97.99 $87.4 09/30/2019 12.12% 17.08%
S 04/29/2018 T-Mobile US, Inc. (TMUS) $7.08 $6.37 06/30/2019 11.09% 24.25%
PACB 11/01/2018 Illumina, Inc. (ILMN) $8.00 $7.22 06/30/2019 10.80% 23.61%
TAHO 11/14/2018 Pan American Silver Corp. (PAAS) $4.10 $3.75 02/26/2019 9.33% 79.22%
CTWS 03/15/2018 SJW Group (SJW) $70.00 $64.27 03/31/2019 8.92% 42.82%
RHT 10/28/2018 IBM (IBM) $190.00 $176.06 12/31/2019 7.92% 8.23%

List of all pending deals:

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

Disclaimer: I hold positions in Athenahealth (ATHN), Finisar (FNSR) and Pandora (P). 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.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria or follow me on Twitter@asifsuria

Leave A Comment

You must be logged in to post a comment.