Merger activity increased last week with four new deals announced and two deals closing. You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.
This is the first time since we started tracking potential deals in the ‘Deals in the Works’ section of our website more than three years ago that all the confirmed deals that were announced last week had been ‘deals in the works’.
Gilead Sciences (GILD) had approached cancer therapy company Forty Seven (FTSV) with a takeover offer on February 27, 2020. On March 2, 2020, the deal was confirmed. Forty Seven’s stock appreciated from $48.79 on February 27 to $93.91 after the deal was announced on March 2. On September 11, 2019, according to Reuters, the Donerail Group, an investment firm led by former activist hedge fund Starboard Value LP executive William Wyatt, had built a stake in Mobile Mini (MINI) and was pushing the company to explore a sale. On March 2, 2020, Mobile Mini agreed to combine with WillScot Corporation in an all stock deal at a 20.33% premium to the closing price of MINI after we added it to our list of potential deals.
We added QIAGEN N.V. (QGEN) to our list of potential deals on November 13, 2019, when Thermo Fisher Scientific (TMO) announced that it was considering purchasing the company. This deal was confirmed on March 3, 2020 when TMO announced that it was acquiring QIAGEN at a premium of approximately 17% to the closing price of the stock after the potential deal was announced. The fourth successful ‘potential deal’ last week was the acquisition of the Meet Group (MEET). On December 16, 2019, the NuCom Group had announced that it was exploring the acquisition of U.S. live streaming app developer Meet Group (MEET). This deal was confirmed on March 5, 2020 at a premium of over 16%.
There was one new deal announced in the Deals in the Works section last week. On March 6, 2020, Gray Television Inc (GTN) made an offer to acquire larger peer Tegna (TGNA) for approximately $8.5 billion. This is the second time we have added TGNA to our list of potential deals. On August 16, 2019, Apollo Global Management (APO) had approached the company about a deal.
In the deal updates section, we saw an intense bidding war between Brookfield (BIP) and Macquarie Infrastructure and Real Assets for the acquisition of Cincinnati Bell (CBB). After entering into multiple amendments with Brookfield, Cincinnati Bell finally announced that it considered MIRA’s proposal as a ‘Superior Proposal’.
Weekly Spread Changes
The table below shows weekly spread changes between February 28, 2020 and March 6, 2020.
Symbol | Quote | Acquiring Company | Acquiring Company Quote | Current Spread | Last Week Spread | Spread Change Weekly | Deal Type |
---|---|---|---|---|---|---|---|
CY | 16.37 | Infineon Technologies AG (IFNNY) | 19.21 | 45.69% | 3.29% | 42.40% | All Cash |
FOMX | 2.99 | Menlo Therapeutics Inc. (MNLO) | 4.15 | -2.68% | -19.17% | 16.49% | Special Conditions |
TGE | 20.61 | Blackstone Infrastructure Partners (N/A) | 8.93% | 1.72% | 7.21% | All Cash | |
KEM | 24.43 | Yageo Corporation (N/A) | 11.34% | 4.29% | 7.05% | All Cash | |
IOTS | 11.64 | Dialog Semiconductor Plc (DLGNF) | 33.01 | 7.82% | 2.37% | 5.45% | All Cash |
NTGN | 1.67 | BioNTech SE (BNTX) | 38.09 | 43.69% | 47.42% | -3.73% | All Stock |
CBB | 15.89 | Brookfield Infrastructure Partners L.P. (BIP) | 52.75 | -8.75% | -4.21% | -4.54% | All Cash |
CDOR | 10.47 | NexPoint Hospitality Trust (N/A) | 6.02% | 11.22% | -5.20% | All Cash | |
YTRA | 2.7 | Ebix, Inc. (EBIX) | 23.71 | -12.19% | -6.90% | -5.29% | All Stock |
GNW | 4.41 | China Oceanwide Holdings Group Co., Ltd. (N/A) | 23.13% | 39.23% | -16.10% | All Cash |
The significant change in the spread for Cypress Semiconductor Corporation (CY) was triggered by U.S. national security officials recommending that President Donald Trump block Infineon Technologies AG’s proposed acquisition of Cypress Semiconductor. Genworth Financial (GNW) and China Oceanwide Holdings Group, the oldest deal in our list, reached an agreement with the New York State Department of Financial Services (NYDFS) that removed one of the final hurdles for the deal. The companies expect to close the transaction by the end of the month.
Deal Statistics:
Total Number of Deals Closed in 2020 | 29 |
Total Number of Deals Not Completed in 2020 | 2 |
Total Number of Pending Deals | |
Cash Deals | 42 |
Stock Deals | 25 |
Stock & Cash Deals | 5 |
Special Conditions | 4 |
Total Number of Pending Deals | 76 |
Aggregate Deal Consideration | $493.4 billion |
New Deals:
Deal Updates:
Closed Deals:
Top 10 deals with largest spreads:
Symbol | Announced Date | Acquiring Company | Closing Price | Last Price | Closing Date | Profit | Annualized Profit |
---|---|---|---|---|---|---|---|
CY | 06/02/2019 | Infineon Technologies AG (IFNNY) | $23.85 | $16.37 | 03/31/2020 | 45.69% | 725.13% |
NTGN | 01/16/2020 | BioNTech SE (BNTX) | $2.40 | $1.67 | 06/30/2020 | 43.69% | 139.89% |
GNW | 10/23/2016 | China Oceanwide Holdings Group Co., Ltd. (N/A) | $5.43 | $4.41 | 03/31/2020 | 23.13% | 367.05% |
FIT | 11/01/2019 | Google LLC (GOOG) | $7.35 | $6.22 | 06/30/2020 | 18.17% | 58.17% |
SORL | 11/29/2019 | Ruili International Inc. (N/A) | $4.72 | $4.23 | 06/30/2020 | 11.58% | 37.09% |
KEM | 11/11/2019 | Yageo Corporation (N/A) | $27.20 | $24.43 | 12/31/2020 | 11.34% | 13.89% |
LACQ | 12/30/2019 | GTWY Holdings Limited (N/A) | $11.50 | $10.35 | 06/30/2020 | 11.11% | 35.58% |
TSG | 10/02/2019 | Flutter Entertainment PLC (PDYPF) | $25.46 | $23.06 | 09/30/2020 | 10.40% | 18.43% |
TGE | 12/17/2019 | Blackstone Infrastructure Partners (N/A) | $22.45 | $20.61 | 06/30/2020 | 8.93% | 28.58% |
IOTS | 02/20/2020 | Dialog Semiconductor Plc (DLGNF) | $12.55 | $11.64 | 09/30/2020 | 7.82% | 13.85% |
List of all pending deals:
The number of active deals in our Merger Arbitrage Tool increased last week to 76 with an aggregate deal consideration of $493.4 billion, an increase from last week’s $473.61 billion. Cypress Semiconductor Corporation (CY) moved to the top of our table of ‘Top 10 deals with largest spreads’, followed by Neon Therapeutics (NTGN), Genworth Financial (GNW) and Fitbit (FIT).
Disclaimer: I hold a long position in Mellanox Technologies (MLNX). 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.
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