We have been writing about two M&A trends this year including bidding wars for companies and consolidation in the banking sector. We saw both trends in play last week with a new superior offer for the railroad Kansas City Southern (KSU) and three new bank mergers announced last week. The three new bank mergers don’t include one where the acquiring company wants the target, Marlin Business Services (MRLN), to cease operations as a bank. It is not surprising that the S&P Regional Banking ETF (KRE) is up more than 30% this year compared to a 10% gain for the S&P 500. One could argue that a more appropriate benchmark for small regional banks might be the Russell 2000 index of small cap stocks. Even in that comparison, KRE is trouncing the 15% year-t0-date returns of the Russell 2000 index.
Merger activity remained steady last week with six new deals announced and seven deals completed. You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.
There were no new deals announced in the Deals in the Works section last week.
There were 4 new SPAC business combinations announced last week. You can find the new SPAC IPO announcements in our SPACs tool here.
- SmartRent.com, Inc. entered into a definitive business combination agreement with Fifth Wall Acquisition Corp. I (FWAA).
- Vivid Seats Inc. has entered into a definitive transaction agreement with Horizon (HZAC), that will result in Vivid Seats Inc. becoming a public company.
- CompoSecure Holdings and Roman DBDR Tech Acquisition (DBDR) entered into a definitive merger agreement.
- SGHC Limited has entered into a definitive agreement with Sports Entertainment Acquisition Corp. (SEAH).
Weekly Spread Changes:
The table below shows weekly spread changes between April 16, 2021, and April 23, 2021.
|TPCO||17.44||Alden Global Capital (N/A)||-1.09%||-6.10%||5.01%||All Cash|
|CXDC||1.025||Faith Dawn Limited and Faith Horizon (N/A)||17.07%||12.15%||4.92%||All Cash|
|NEWA||3.39||Crouching Tiger Holding Limited (N/A)||7.67%||4.29%||3.38%||All Cash|
|GRUB||72.61||Just Eat Takeaway.com N.V. (TKAYY)||11.18||3.32%||1.16%||2.16%||All Stock|
|CCRC||6.15||Taiying Group Ltd. and Taiying International Inc. (N/A)||0.00||5.69%||4.00%||1.69%||All Cash|
|COHR||269.84||II-VI Incorporated (IIVI)||77.87||7.79%||9.72%||-1.93%||Cash Plus Stock|
|CHNG||23.22||UnitedHealth Group Incorporated (UNH)||400.31||10.90%||12.89%||-1.99%||All Cash|
|LINX||6.92||StoneCo Ltd. (STNE)||67.67||-9.68%||-6.86%||-2.82%||Special Conditions|
|MX||25.87||South Dearborn Limited (N/A)||12.10%||15.31%||-3.21%||All Cash|
|KSU||301.62||Canadian Pacific Railway Limited (CP)||370.71||-10.06%||5.08%||-15.14%||Cash Plus Stock|
|Total Number of Deals Closed in 2021||62|
|Total Number of Deals Not Completed in 2021||3|
|Total Number of Pending Deals|
|Stock & Cash Deals||15|
|Total Number of Pending Deals||85|
|Aggregate Deal Consideration||$663.59 billion|
- The merger of Sterling Bancorp (STL) and Webster Financial Corporation (WBS) for $5.12 billion in an all stock deal. Under the terms of the agreement, Sterling will merge into Webster, and Sterling’s shareholders will receive a fixed exchange ratio of 0.463 of a Webster share for each share of Sterling stock they own.
- The acquisition of Knoll (KNL) by Herman Miller (MLHR) for $1.8 billion in a cash plus stock deal. Under the terms of the agreement, Knoll shareholders will receive $11.00 in cash and 0.32 shares of Herman Miller common stock for each share of Knoll common stock they own.
- The acquisition of Marlin Business Services (MRLN) by HPS Investment Partners for $109.4 million or $23.50 per share in cash.
- The merger of American River Bankshares (AMRB) and Bank of Marin Bancorp (BMRC) for $134.5 million in an all stock deal. Under the terms of the agreement, AMRB shareholders will receive a fixed exchange ratio of 0.575 shares of BMRC common stock for each share of AMRB common stock outstanding.
- The acquisition of Welbilt (WBT) by The Middleby Corporation (MIDD) for $4.3 billion in an all stock deal. Under the terms of the agreement, Welbilt shareholders will receive a fixed exchange ratio of 0.1240 shares of Middleby common stock for each share of Welbilt common stock.
- The acquisition of Meridian Bancorp (EBSB) by Independent Bank Corp. (INDB) for $1.15 billion in an all stock deal. Under the terms of the agreement, each Meridian stockholder will receive 0.2750 of a share of Independent common stock for each share of Meridian common stock.
- On April 19, 2021, Tribune Publishing Company (TPCO) confirmed receipt of a letter from Stewart Bainum, in which Mr. Bainum communicated that Hansjörg Wyss has informed him that he will no longer provide the level of equity commitment indicated in the revised, non-binding proposal from Newslight dated April 1, 2021, to acquire all of the outstanding shares of Tribune common stock for $18.50 per share in cash.
- On April 20, 2021, Canadian National Railway (CNI) announced that it has made a superior proposal to combine with Kansas City Southern (KSU) in a cash-and-stock transaction valued at $33.7 billion, or $325 per share.
- On April 20, 2021, The US Department of Justice intervened in the proposed merger of Aon (AON) with Willis Towers Watson (WLTW), demanding divestitures in addition to those set out by the European Commission (EC).
- On April 21, 2021, shareholders of RigNet (RNET) approved the company’s merger with Viasat (VSAT) at a special meeting of shareholders.
- On April 21, 2021, AVANGRID (AGR) announced that it has received Federal Energy Regulatory Commission (FERC) approval for its proposed PNM Resources (PNM) merger.
- On April 21, 2021, South Korea’s antitrust authority approved Analog Devices (ADI) planned purchase of Maxim Integrated (MXIM).
- On April 23, 2021, GW Pharmaceuticals (GWPH) and Jazz Pharmaceuticals (JAZZ) announced that GW’s shareholders voted to approve the acquisition of GW by a subsidiary of Jazz at the GW shareholder meetings. The Court hearing to sanction the acquisition is currently scheduled for May 5, 2021, and the completion of the acquisition is expected to occur shortly thereafter.
- April 23, 2021: Australia’s review of Aon’s (AON) purchase of Willis Towers (WLTW) has been delayed as the regulator needs more information from the parties.
- On April 24, 2021, Canadian Pacific Railway (CP) welcomed the U.S. Surface Transportation Board’s (STB) decision to approve its merger with Kansas City Southern (KSU).
- On April 24, 2021, Kansas City Southern (KSU) announced that its Board of Directors has unanimously determined that the unsolicited proposal received from Canadian National Railway (CNI) on April 20, 2021 to acquire KCS in a cash and stock transaction valued by CN at $325 per KCS share could reasonably be expected to lead to a “Company Superior Proposal”.
- The acquisition of Inphi Corporation (IPHI) by Marvell Technology Group (MRVL) on April 20, 2021. It took 173 days for this deal to be completed.
- The acquisition of China Biologic Products Holdings (CBPO) by CBPO Holdings Limited and CBPO Group Limited on April 20, 2021. It took 152 days for this deal to be completed.
- The acquisition of NIC Inc. (EGOV) by Tyler Technologies (TYL) on April 21, 2021. It took 70 days for this deal to be completed.
- The acquisition of Ruhnn Holding Limited (RUHN) by RUNION Holding Limited on April 20, 2021. It took 76 days for this deal to be completed.
- The acquisition of CRH Medical Corporation (CRHM) by Well Health Technologies on April 22, 2021. It took 73 days for this deal to be completed.
- The acquisition of GenMark Diagnostics (GNMK) by Roche (RHHBY) on April 22, 2021. It took 38 days for this deal to be completed.
- The acquisition of RealPage (RP) by Thoma Bravo on April 22, 2021. It took 122 days for this deal to be completed.
Top 10 deals with largest spreads:
|DOYU||10/12/2020||HUYA Inc. (HUYA)||$13.51||$10.5||06/30/2021||28.62%||160.71%|
|CXDC||06/15/2020||Faith Dawn Limited and Faith Horizon (N/A)||$1.20||$1.025||05/10/2021||17.07%||445.12%|
|SJR||03/15/2021||Rogers Communications Inc. (RCI)||$32.40||$27.79||06/30/2022||16.59%||14.08%|
|HCAP||12/23/2020||Portman Ridge Finance Corporation (PTMN)||$10.12||$8.84||06/30/2021||14.46%||81.21%|
|MX||03/26/2021||South Dearborn Limited (N/A)||$29.00||$25.87||12/31/2021||12.10%||17.74%|
|CHNG||01/06/2021||UnitedHealth Group Incorporated (UNH)||$25.75||$23.22||12/31/2021||10.90%||15.97%|
|OSN||12/17/2020||New Ossen Group Limited (N/A)||$5.10||$4.62||06/30/2021||10.39%||58.34%|
|XLNX||10/27/2020||Advanced Micro Devices, Inc. (AMD)||$142.63||$129.66||12/31/2021||10.00%||14.66%|
|MRLN||04/19/2021||HPS Investment Partners LLC (N/A)||$23.50||$21.62||03/31/2022||8.70%||9.36%|
|COHR||03/25/2021||II-VI Incorporated (IIVI)||$290.86||$269.84||12/31/2021||7.79%||11.42%|
List of all pending deals:
List of all pending deals:
Disclaimer: I have long positions in Change Healthcare (CHNG) and Brookfield Property Partners (BPY). 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.