Merger Arbitrage Mondays – Novartis Confirms The Acquisition Of The Medicines Company

Merger activity decreased with three new deals announced and five 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 175
Total Number of Deals Not Completed in 2019 9
Total Number of Pending Deals
Cash Deals 43
Stock Deals 19
Stock & Cash Deals 6
Special Conditions 5
Total Number of Pending Deals 73
Aggregate Deal Consideration $1.28 trillion

New Deals:

  1. The acquisition of Carolina Financial Corporation (CARO) by United Bankshares (UBSI) for $1.1 billion in an all stock deal. Under the terms of the agreement, United will acquire 100% of the outstanding shares of Carolina Financial in exchange for 1.13 of United’s shares.
  2. The acquisition of The Medicines Company (MDCO) by Novartis AG (NVS) for $9.7 billion or $85.00 per share in cash. We added MDCO as a potential deal to the Deals in the Works section on November 19, 2019, and the price after the news of the potential deal came out was $70.21.
  3. The acquisition of Tiffany & Co. (TIF) by LVMH Moët Hennessy Louis Vuitton SE (LVMUY) for $16.2 billion or $135.00 per share in cash. We added TIF as a potential deal to the Deals in the Works section on October 28, 2019, and the price after the news of the potential deal came out was $129.72.

Deal Updates:

  1. On November 18, 2019, Carrizo Oil & Gas (CRZO) and Callon Petroleum Company (CPE) announced that the Carrizo special meeting is scheduled to be reconvened to consider and vote on matters relating to the merger agreement on December 20, 2019. According to Reuters, hedge fund Paulson & Co, a top shareholder in Callon Petroleum said that it would not oppose the company’s reduced buyout offer for Carrizo Oil & Gas, while cutting its stake in the company.
  2. On November 19, 2019, BB&T Corporation (BBT) and SunTrust Banks (STI) announced the receipt of regulatory approvals from the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation to complete the previously announced merger of equals and become Truist Financial Corporation. BB&T and SunTrust expect to complete the merger on December 6, 2019.
  3. On November 20, 2019, Milacron Holdings (MCRN) announced that its stockholders voted to adopt the Agreement and Plan of Merger with Hillenbrand and Bengal Delaware Holding Corporation. Milacron and Hillenbrand anticipate that the transaction will close on November 21, 2019.
  4. On November 22, 2019, Anixter (AXE) announced that Anixter and CD&R agreed to an amendment to the Merger Agreement to increase the per-share consideration payable to Anixter’s shareholders to $82.50 per share in cash from $81.00 per share in cash.
  5. On November 22, 2019, Roche has again extended the deadline for its tender offer for Spark Therapeutics (ONCE), saying U.S. and British anti-trust authorities needed more time to review the deal. The offer, which was originally due to expire on November 25, has now been extended to December 10.

Closed Deals:

  1. The acquisition of Gannett (GCI) by New Media Investment Group (NEWM) on November 19, 2019. It took 106 days for this deal to be completed.
  2. The acquisition of Celgene Corporation (CELG) by Bristol-Myers Squibb Company (BMY) on November 20, 2019. It took 321 days for this deal to be completed.
  3. The acquisition of Milacron Holdings (MCRN) by Hillenbrand (HI) on November 21, 2019. It took 132 days for this deal to be completed.
  4. The acquisition of Avedro (AVDR) by Glaukos Corporation (GKOS) on November 21, 2019. It took 105 days for this deal to be completed.
  5. The acquisition of Old Line Bancshares (OLBK) by WesBanco (WSBC) on November 22, 2019. It took 122 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
PACB 11/01/2018 Illumina, Inc. (ILMN) $8.00 $5.17 03/31/2020 54.74% 157.32%
S 04/29/2018 T-Mobile US, Inc. (TMUS) $8.06 $5.74 01/31/2020 40.42% 220.21%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.06 12/31/2019 33.74% 342.13%
MDCO 11/24/2019 Novartis AG (NVS) $85.00 $68.55 03/31/2020 24.00% 68.97%
ABDC 08/13/2019 Crescent Capital BDC, Inc. (N/A) $11.02 $9.06 12/31/2019 21.63% 219.34%
OHAI 08/01/2019 Portman Ridge Finance Corporation (PTMN) $1.46 $1.28 12/31/2019 14.06% 142.58%
MLNX 03/11/2019 NVIDIA Corporation (NVDA) $125.00 $114.5 03/31/2020 9.17% 26.36%
TIF 11/25/2019 LVMH Moët Hennessy Louis Vuitton SE (LVMUY) $135.00 $125.51 06/30/2020 7.56% 12.66%
FIT 11/01/2019 Google LLC (N/A) $7.35 $6.86 06/30/2020 7.14% 11.96%
AGN 06/25/2019 AbbVie Inc. (ABBV) $194.82 $183.79 03/31/2020 6.00% 17.25%

List of all pending deals:

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

Disclaimer: I hold long positions in Sprint (S), Mellanox Technologies (MLNX), Pacific Biosciences of California (PACB) and Bristol-Myers Squibb (BMY). 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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