Merger Arbitrage Mondays – Condor Hospitality Terminates Merger Agreement With NHT Operating Partnership

Merger activity slowed down last week with no new deals announced, one completed active deal and one deal terminated.

Two potential deals were announced last week.

  1. According to Bloomberg, UBS Group (UBS) Chairman Axel Weber has been studying the feasibility of a mega-merger with rival Credit Suisse Group (CS) as part of a regular thought-exercise on future strategic options.
  2. 51job (JOBS) announced that its Board of Directors has received a preliminary non-binding proposal letter from DCP Capital Partners to acquire all of the outstanding common shares of the company for $79.05 in cash per common share.

Due to failure of NHT’s operating partnership to consummate the acquisition and for material breaches of the merger agreement, Condor Hospitality Trust (CDOR) decided to terminate its merger agreement with NHT Operating Partnership. The Company is entitled to receive a termination fee of $11.925 million within five business days of its termination of the merger agreement.

You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.

There were two new deals announced in the Deals in the Works section last week.

Weekly Spread Changes:

The table below shows weekly spread changes between September 11, 2020, and September 18, 2020.

Symbol Quote Acquiring
Company
Acquiring
Company Quote
Current
Spread
Last Week
Spread
Spread Change
Weekly
Deal
Type
GNW 3.28 China Oceanwide Holdings Group Co., Ltd. (N/A) 65.55% 46.36% 19.19% All Cash
TIF 116.26 LVMH Moët Hennessy Louis Vuitton SE (LVMUY) 98.8 16.12% 0.00% 16.12% All Cash
GRUB 69.25 Just Eat Takeaway.com N.V. (TKAYY) 10.885 5.47% 2.67% 2.80% All Stock
ONDK 1.57 Enova International, Inc. (ENVA) 16.55 4.62% 2.02% 2.60% Cash Plus Stock
MR 4.52 Southwestern Energy Company (SWN) 2.45 1.12% -1.46% 2.58% All Stock
GILT 5.55 Comtech Telecommunications Corp. (CMTL) 15.45 52.82% 55.17% -2.35% Cash Plus Stock
CBMG 18.7 CBMG management (N/A) 0.00 5.61% 8.46% -2.85% All Cash
TAT 0.2465 TAT Holdco LLC and TAT Merger Sub LLC (N/A) 0.00 -47.26% -42.09% -5.17% All Cash
BREW 16.47 Anheuser-Busch (N/A) 0.18% 5.63% -5.45% All Cash
SUNW 0.84 The Peck Company Holdings, Inc. (PECK) 3.35 -26.15% -18.44% -7.71% All Stock

Deal Statistics:

Total Number of Deals Closed in 2020 95
Total Number of Deals Not Completed in 2020 15
Total Number of Pending Deals
Cash Deals 30
Stock Deals 14
Stock & Cash Deals 4
Special Conditions 3
Total Number of Pending Deals 51
Aggregate Deal Consideration $661.28 billion

Deal Updates:

  1. September 14, 2020: According to Reuters, Israel’s Petroleum Council gave its approval for Chevron (CVX) to take over Noble Energy’s (NBL) stakes in Israeli natural gas fields.
  2. On September 15, 2020, Momenta Pharmaceuticals (MNTA) announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (“HSR”), in connection with the all-cash tender offer by Vigor Sub, a wholly owned subsidiary of Johnson & Johnson (JNJ).
  3. On September 16, 2020, Livongo (LVGO) and Teladoc Health (TDOC) announced that the Special Meeting of stockholders is scheduled to take place virtually on October 29, 2020.
  4. On September 18, 2020, Bitauto Holdings Limited (BITA) announced that it has called an extraordinary general meeting of shareholders to be held on October 23, 2020.
  5. On September 16, 2020, Genworth Financial (GNW) announced that while it continues to work with China Oceanwide Holdings Group toward closing the merger transaction with Oceanwide by September 30, 2020, Genworth has scheduled its 2020 Annual Meeting in order to comply with the New York Stock Exchange listing standards.
  6. September 18, 2020: According to Reuters, LVMH said that it had submitted its troubled takeover of Tiffany (TIF), which is now at the centre of a legal dispute between the two groups, for EU approval as it seeks to counter accusations that it deliberately stalled antitrust proceedings.
  7. September 19, 2020: According to Reuters, the U.S. Justice Department said approved Anheuser-Busch’s plan to buy the shares of Craft Brew Alliance (BREW) that it does not already own.

Closed Deals:

  1. The acquisition of 58.com (WUBA) by Quantum Bloom Group on September 18, 2020. It took 95 days for this deal to be completed.

Terminated Deals: 

  1. On September 18, 2020, Condor Hospitality Trust (CDOR) announced that it has terminated its merger agreement with NHT Operating Partnership. The Company terminated the merger agreement due to failure of NHT’s operating partnership to consummate the acquisition of the Company and for material breaches of the merger agreement by NHT’s operating partnership and its affiliates.

Top 10 deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annualized
Profit
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $3.2800 09/30/2020 65.55% 2392.53%
GILT 01/29/2020 Comtech Telecommunications Corp. (CMTL) $8.48 $5.55 10/31/2021 52.82% 47.49%
TIF 11/25/2019 LVMH Moët Hennessy Louis Vuitton SE (LVMUY) $135.00 $116.26 12/31/2020 16.12% 57.68%
FIT 11/01/2019 Google LLC (GOOG) $7.35 $6.37 12/31/2020 15.38% 55.05%
MXIM 07/13/2020 Analog Devices, Inc. (ADI) $72.39 $66.14 06/30/2021 9.45% 12.19%
WLTW 03/09/2020 Aon plc (AON) $217.08 $205.31 06/30/2021 5.73% 7.39%
INWK 07/16/2020 HH Global Group Limited (N/A) $3.00 $2.84 12/31/2020 5.63% 20.16%
CBMG 08/12/2020 CBMG management (N/A) $19.75 $18.7 12/31/2020 5.61% 20.09%
GRUB 06/10/2020 Just Eat Takeaway.com N.V. (TKAYY) $73.04 $69.25 06/30/2021 5.47% 7.06%
ONDK 07/28/2020 Enova International, Inc. (ENVA) $1.64 $1.57 12/31/2020 4.62% 16.55%

List of all pending deals:

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

Disclaimer: 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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