Merger Arbitrage Mondays – Nine New Deals Worth Over $100 Billion Announced Last Week

Merger activity increased last week with nine new deals announced and two 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 76
Total Number of Deals Not Completed in 2019 5
Total Number of Pending Deals
Cash Deals 34
Stock Deals 17
Stock & Cash Deals 12
Special Conditions 3
Total Number of Pending Deals 66
Total Deal Size $910.91 billion

New Deals:

  1. The acquisition of Chesapeake Lodging Trust (CHSP) by Park Hotels & Resorts (PK) for $2.7 billion in a cash plus stock deal. Under the terms of the merger agreement, Chesapeake shareholders will receive $11.00 in cash and 0.628 of a share of Park common stock for each Chesapeake share.
  2. The acquisition of Aquantia (AQ) by Marvell Technology Group (MRVL) for $452 million or $13.25 per share in cash.
  3. The acquisition of Intermolecular (IMI) by Merck KGaA for $28.5 million or $1.20 per share in cash.
  4. The acquisition of Zayo Group Holdings (ZAYO) by affiliates of Digital Colony Partners and EQT Infrastructure IV fund for $14.3 billion or $35.00 per share in cash. We added ZAYO as a potential deal to the Deals in the Works section on November 19, 2018 and the price after the news of the potential deal came out was $26.00.
  5. The acquisition of Andeavor Logistics (ANDX) by MPLX LP (MPLX) for $14.41 billion in an all stock deal. Under the terms of the merger agreement, ANDX public unitholders will receive 1.135x MPLX common units for each ANDX common unit held and Marathon Petroleum Corporation (MPC) will receive 1.0328 MPLX common units for each ANDX common unit held, representing a 2.4% discount.
  6. The acquisition of EMC Insurance Group (EMCI) by Employers Mutual Casualty Company for $791 million or $36.00 per share in cash. We added EMCI as a potential deal to the Deals in the Works section on November 16, 2018 and the price after the news of the potential deal came out was $31.02.
  7. The acquisition of Control4 Corporation (CTRL) by SnapAV for $680 million or $23.91 per share in cash.
  8. The acquisition of Buckeye Partners (BPL) by IFM Global Infrastructure Fund for $10.3 billion or $41.50 per share in cash.
  9. The acquisition of Anadarko Petroleum Corporation (APC) by Occidental Petroleum Corporation (OXY) for $57 billion in a cash plus stock deal. Under the terms of the agreement, Occidental will acquire Anadarko Petroleum Corporation for $59.00 in cash and 0.2934 shares of Occidental common stock per share of Anadarko common stock.
  10. The acquisition of Netshoes (Cayman) Limited (NETS) by Magazine Luiza for $85.04 million or $2.00 per share in cash. This deal was announced the week before last but did not get wide coverage. An automated system we have in place that scans for new deals picked it up from a SEC filing last week.

Deal Updates:

  1. On May 3, 2019, IBM (IBM) was informed that the U.S. Department of Justice has concluded its review of IBM’s proposed acquisition of Red Hat (RHT) without remedies or conditions and received a notice of early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
  2. On May 6, 2019, Anadarko Petroleum’s (APC) board has declared Occidental Petroleum’s (OXY) sweetened $38 billion takeover “superior,” giving Chevron (CVX) four days to either boost its offer or walk away from the oil industry’s biggest deal in at least four years.
  3. On May 7, 2019, WABCO Holdings (WBC) announced that it had established a record date of May 17, 2019, and a special meeting date of June 27, 2019, for a meeting of its stockholders to vote on the Plan of Merger with ZF Friedrichshafen AG.
  4. On May 7, 2019, Ameris Bancorp (ABCB) and Fidelity Southern Corporation (LION) jointly announced that shareholders of both companies have voted to approve all proposals necessary to complete the merger of Fidelity with and into Ameris. The transaction is expected to close in the second quarter of 2019.
  5. On May 8, 2019, shareholders of Nightstar Therapeutics (NITEapproved the company’s merger with Biogen(BIIB) at a special meeting of shareholders.
  6. On May 9, 2019, Versum Materials (VSM) announced that it will hold a special meeting of its stockholders on June 17, 2019.
  7. On May 9, 2019, Chevron Corporation (CVX) announced that, under the terms of its previously announced Merger Agreement with Anadarko Petroleum Corporation (APC), it will not make a counterproposal and will allow the four-day match period to expire.  Accordingly, Chevron anticipates that Anadarko will terminate the Merger Agreement.
  8. On May 9, 2019, Cousins Properties (CUZ) TIER REIT (TIER) announced that they will each hold special meetings of their respective stockholders on Wednesday, June 12, 2019.
  9. On May 9, 2019, Oncor Electric Delivery Company and Sempra Energy (SRE) announced that they have received approval from the Public Utility Commission of Texas (PUCT) for Oncor’s acquisition of InfraREIT (HIFR).
  10. On May 10, 2019, Netshoes (Cayman) Limited (NETS) announced that it has set a date for a special meeting of its stockholders to consider and vote on the Transaction with ConversionPoint Technologies. The special meeting will be held on May 30, 2019.

Closed Deals:

  1. The acquisition of Attunity (ATTU) by Qlik on May 6, 2019. It took 74 days for this deal to be completed.
  2. The acquisition of Top Image Systems (TISA) by Thoma Bravo on May 6, 2019. It took 91 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 $1.2 06/30/2019 85.00% 646.35%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $3.6 06/30/2019 50.83% 386.55%
S 04/29/2018 T-Mobile US, Inc. (TMUS) $7.72 $6.19 07/29/2019 24.65% 116.83%
STC 03/19/2018 Fidelity National Financial, Inc. (FNF) $50.29 $42.38 06/30/2019 18.66% 141.91%
WCG 03/27/2019 Centene Corporation (CNC) $306.07 $273.62 06/30/2020 11.86% 10.46%
PACB 11/01/2018 Illumina, Inc. (ILMN) $8.00 $7.41 06/30/2019 7.96% 60.55%
ZAYO 05/08/2019 affiliates of Digital Colony Partners and EQT Infrastructure IV fund (N/A) $35.00 $32.83 06/30/2020 6.61% 5.83%
MLNX 03/11/2019 NVIDIA Corporation (NVDA) $125.00 $117.9 12/31/2019 6.02% 9.47%
LKSD 10/31/2018 Quad/Graphics, Inc. (QUAD) $6.81 $6.45 06/30/2019 5.62% 42.74%
BXG 03/04/2019 BBX Capital Corporation (BBX) $16.00 $15.15 05/15/2019 5.61% 1023.93%

List of all pending deals:

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

Disclaimer: I hold long positions in Red Hat (RHT), Celgene (CELG), Bristol-Myers Squibb (BMY) and Finisar (FNSR). 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

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