Merger Arbitrage Mondays – Zendesk Shareholders Unhappy About Momentive Deal

  • November 1, 2021

Merger activity increased last week with five new deals announced and four deals completed.

We added Momentive Global (MNTV) as a potential deal in the works on October 6, 2021, when Bloomberg reported that Activist investor Legion Partners Asset Management was calling for a strategic review including a potential sale of the company. Momentive’s price after this announcement was $20.61.

Momentive Global, formerly known as SurveyMonkey was founded in 1999. Dave Goldberg joined SurveyMonkey as CEO in 2009 and in the same year Spectrum Equity and Bain Capital acquired a majority interest in the company. The company is headquartered in San Mateo, California and operates as an experience management company, providing cloud-based software solutions to companies.

On October 28, 2021, Zendesk (ZEN) announced that it will acquire Momentive, including its iconic SurveyMonkey platform in an all stock deal. Zendesk stock fell 14% and Momentive fell 8% after this deal was announced. In its most recent quarter, Zendesk grew its earnings by 32% while Momentive grew its revenue by just 20%.  Zendesk is also profitable, while Momentive has been posting losses. Zendesk investors are clearly not happy with this deal and the stock received multiple downgrades after the deal was announced. Shareholder approval is likely to be the key hurdle with this deal considering Momentive stock is now trading below where it was before the deal was announced.

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.

SPAC Arbitrage

There were 15 SPAC IPOs filed and 2 new SPAC business combinations announced last week. You can find the new SPAC IPO announcements in our SPACs tool here.

  1. FaZe Clan announced that it has entered into a definitive merger agreement to combine with B. Riley Principal 150 Merger (BRPM).
  2. Tailwind Two Acquisition (TWNT) and Terran Orbital Corporation, the global leader and pioneer in the development, innovation and operation of small satellites and earth observation solutions, jointly announced that they have entered into a definitive business combination agreement.

Weekly Spread Changes:

The table below shows weekly spread changes between October 22 and October 29, 2021.

Company Quote
Last Week
Spread Change
TEDU0.8712Kidedu Holdings Limited (N/A)359.14%277.36%81.78%All Cash
JOBS59.56Garnet Faith Limited (N/A)0.0032.72%23.55%9.17%All Cash
CLDB29.15Farmers National Banc Corp. (FMNB)17.826.98%2.89%4.09%All Stock
FBC47.19New York Community Bancorp, Inc. (NYCB)12.435.76%2.07%3.69%All Stock
SPWH17.26The Great American Outdoors Group (N/A)4.29%1.93%2.36%All Cash
HBMD20.71F.N.B. Corporation (FNB)11.651.26%3.98%-2.72%All Stock
MRLN22.92HPS Investment Partners LLC (N/A)2.53%5.57%-3.04%All Cash
XLNX180Advanced Micro Devices, Inc. (AMD)120.1615.05%19.65%-4.60%All Stock
XONE23.02Desktop Metal, Inc. (DM)6.9910.77%15.49%-4.72%Special Conditions
MX18.96South Dearborn Limited (N/A)52.95%61.38%-8.43%All Cash

Deal Statistics:

Total Number of Deals Closed in 2021158
Total Number of Deals Not Completed in 202112
Total Number of Pending Deals
Cash Deals48
Stock Deals31
Stock & Cash Deals6
Special Conditions5
Total Number of Pending Deals90
Total Deal Size$943.94 billion

New Deals:

  1. The acquisition of PAE Inc. (PAE) by Amentum Government Services Holdings for $1.9 billion or $10.05 per share in cash.
  2. The acquisition of Dawson Geophysical Company (DWSN) by Wilks Brothers for $18.56 million or $2.34 per share in cash.
  3. The merger of Oasis Midstream Partners (OMP) with Crestwood Equity Partners (CEQP) for $1.8 billion in an all stock deal. Under the terms of the agreement, OMP unitholders will receive 0.87 units of Crestwood common units for each unit of OMP owned.
  4. The acquisition of Phillips 66 Partners (PSXP) by Phillips 66 (PSX) for $14.5 billion in an all stock deal. Under the terms of the agreement, each outstanding PSXP common unitholder would receive 0.50 shares of PSX common stock for each PSXP common unit.
  5. The acquisition of Momentive Global (MNTV) by Zendesk (ZEN) for $4.21 billion in an all stock deal. Under the terms of the agreement, Momentive stockholders will receive 0.225 shares of Zendesk stock for each share of Momentive stock. We added MNTV as a potential deal to the Deals in the Works section on October 6, 2021, and the price after the news of the potential deal came out was $20.61.

Deal Updates:

  1. On October 27, 2021, Sanderson Farms (SAFM) has received regulatory approvals from each of the Ministry of Commerce of the People’s Republic of China and the Federal Economic Competition Commission of Mexico in connection with the transactions contemplated by the Agreement and Plan of Merger.
  2. On October 27, 2021, Trillium Therapeutics (TRIL) announced that it has received a final order from the Supreme Court of British Columbia approving the previously announced plan of arrangement with PF Argentum, a wholly-owned, indirect subsidiary of Pfizer (PFE).
  3. On October 28, 2021, The waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), expired in connection with the previously announced proposed merger between The ExOne Company (XONE) and Desktop Metal (DM).
  4. On October 28, 2021, the Acting CFIUS Staff Chairperson notified Magnachip Semiconductor Corporation (MX) and South Dearborn Limited that CFIUS is undertaking an investigation of the Merger pursuant to Section 721(b)(2) of the Defense Production Act of 1950, as amended, which will be completed no later than December 13, 2021. There can be no assurance that the Company and Parent will develop or agree to any proposals that would result in CFIUS clearance.
  5. On October 29, 2021, shareholders of Extraction Oil & Gas (XOGapproved the company’s merger with Bonanza Creek Energy (BCEI) at a special meeting of shareholders.
  6. On October 29, 2021, Canadian Pacific Railway Limited (CP) and Kansas City Southern (KSU) announced that they have jointly filed a railroad control application with the Surface Transportation Board regarding the proposed transaction to create Canadian Pacific Kansas City.

Closed Deals:

  1. The acquisition of Cadence Bancorporation (CADE) by BancorpSouth Bank (BXS) on October 29, 2021. It took 200 days for this deal to be completed.
  2. The acquisition of Misonix (MSON) by Bioventus (BVS) on October 29, 2021. It took 92 days for this deal to be completed.
  3. The acquisition of Medallia (MDLA) by Thoma Bravo on October 29, 2021. It took 95 days for this deal to be completed.
  4. The acquisition of Severn Bancorp (SVBI) by Shore Bancshares (SHBI) on October 29, 2021. It took 240 days for this deal to be completed.

Top 10 deals with largest spreads:

TEDU04/30/2021Kidedu Holdings Limited (N/A)$4.00$0.871212/31/2021359.14%2148.93%
MX03/26/2021South Dearborn Limited (N/A)$29.00$18.9612/31/202152.95%316.85%
JOBS06/21/2021Garnet Faith Limited (N/A)$79.05$59.5612/31/202132.72%195.80%
CHNG01/06/2021UnitedHealth Group Incorporated (UNH)$25.75$21.5312/31/202119.60%117.28%
AJRD12/20/2020Lockheed Martin Corporation (LMT)$51.00$44.0112/31/202115.88%95.04%
XLNX10/27/2020Advanced Micro Devices, Inc. (AMD)$207.08$18012/31/202115.05%90.03%
SJR03/15/2021Rogers Communications Inc. (RCI)$32.40$28.8406/30/202212.34%18.62%
XONE08/11/2021Desktop Metal, Inc. (DM)$25.50$23.0212/31/202110.77%64.46%
SOLY05/10/2021Allergan Aesthetics (N/A)$22.60$20.5912/31/20219.76%58.41%
COHR03/25/2021II-VI Incorporated (IIVI)$275.06$254.412/31/20218.12%48.60%

List of all pending deals:

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

Target VolumeEstimated
Closing Date
+TEDU4/30/21Kidedu Holdings Limited (N/A)All Cash$230.6 M$4.00$0.8712578,11812/31/21359.14%2184.75%
+MX3/26/21South Dearborn Limited (N/A)All Cash$1.4 B$29.00$18.96266,27212/31/2152.95%322.13%
+JOBS6/21/21Garnet Faith Limited (N/A)All Cash$3.63 B$79.05$59.56434,82312/31/2132.72%199.07%
+CHNG1/06/21UnitedHealth Group Incorporated (UNH)All Cash$13.28 B$25.75$21.53910,07212/31/2119.60%119.24%
+AJRD12/20/20Lockheed Martin Corporation (LMT)All Cash$3.79 B$51.00$44.01417,08012/31/2115.88%96.62%
+XLNX10/27/20Advanced Micro Devices, Inc. (AMD)All Stock$33.43 B$207.08$1801,355,29012/31/2115.05%91.53%
+SJR3/15/21Rogers Communications Inc. (RCI)Special Conditions$26 B$32.40$28.84218,7256/30/2212.34%18.70%
+XONE8/11/21Desktop Metal, Inc. (DM)Special Conditions$418.26 M$25.50$23.021,088,64012/31/2110.77%65.54%
+SOLY5/10/21Allergan Aesthetics (N/A)All Cash$550 M$22.60$20.59141,12912/31/219.76%59.39%
+COHR3/25/21II-VI Incorporated (IIVI)Cash Plus Stock$6.84 B$275.06$254.4145,07712/31/218.12%49.41%
+SAFM8/09/21Cargill and Continental Grain Company (N/A)All Cash$4.49 B$203.00$189.45147,7291/31/227.15%28.69%
+CLDB6/23/21Farmers National Banc Corp. (FMNB)All Stock$124 M$31.19$29.1511,23712/31/216.98%42.47%
+NFH8/04/21Unicorn II Holdings Limited (N/A)All Cash$2.09 billion$12.00$11.25154,81112/31/216.67%40.56%
+FBC4/26/21New York Community Bancorp, Inc. (NYCB)All Stock$2.6 B$49.91$47.19884,86812/31/215.76%35.03%
+VNE10/04/21Qualcomm Incorporated (QCOM)All Cash$3.87 B$37.00$35.2299,1036/30/225.11%7.74%
+XENT8/06/21Medtronic plc (MDT)All Cash$1.1 billion$28.25$26.97220,5333/31/224.75%11.55%
+FOE5/11/21Prince International Corporation (N/A)All Cash$2.1 B$22.00$21.02220,1563/31/224.66%11.34%
+SPWH12/21/20The Great American Outdoors Group (N/A)All Cash$1.5 B$18.00$17.26644,60012/31/214.29%26.08%
+XLRN9/30/21Merck (MRK)All Cash$10.8 B$180.00$174.18692,53312/31/213.34%20.33%
+INFO11/30/20S&P Global (SPGI)All Stock$44 B$134.57$130.722,411,10612/31/212.94%17.90%
+FVCB7/14/21Blue Ridge Bankshares, Inc. (BRBS)All Stock$113.36 M$21.09$20.59,2761/31/222.87%11.50%
+GWB9/16/21First Interstate BancSystem, Inc. (FIBK)All Stock$2 B$35.02$34.05590,2613/31/222.86%6.95%
+FCCY7/12/21Lakeland Bancorp, Inc. (LBAI)All Stock$244.4 M$24.41$23.784,1731/31/222.66%10.65%
+MRLN4/19/21HPS Investment Partners LLC (N/A)All Cash$109.4 M$23.50$22.9282,2043/31/222.53%6.16%
+ACBI7/23/21SouthState Corporation (SSB)All Stock$542 M$28.11$27.5168,1903/31/222.19%5.33%
+TRIL8/23/21Pfizer Inc. (PFE)All Cash$1.2 B$18.50$18.11733,02712/31/212.15%13.10%
+AZPN10/11/21Emerson Electric Co. (EMR)Special Conditions$12.34 B$160.00$156.69440,3016/30/222.11%3.20%
+GTS8/24/21GuideWell Mutual Holding Corporation (N/A)All Cash$665.93 M$36.00$35.2969,8446/30/222.01%3.05%
+TSC10/20/21Raymond James Financial, Inc. (RJF)Cash Plus Stock$1.1 B$30.65$30.05237,3876/30/221.99%3.01%
+RIVE7/01/21Mid Penn Bancorp, Inc. (MPB)All Stock$124.7 M$13.54$13.2810,28612/31/211.97%12.00%
+OMP10/26/21Crestwood Equity Partners LP (CEQP)All Stock$1.8 B$25.36$24.88235,8761/31/221.93%7.75%
+CIT10/16/20First Citizens BancShares, Inc. (FCNCA)All Stock$2.42 B$50.46$49.53492,1943/31/221.88%4.58%
+KRA9/27/21DL Chemical Co., Ltd. (N/A)All Cash$2.5 B$46.50$45.65378,3966/30/221.86%2.82%
+MGP8/04/21VICI Properties Inc. (VICI)All Stock$17.2 billion$40.09$39.38659,0266/30/221.81%2.74%
+STL4/19/21Webster Financial Corporation (WBS)All Stock$5.12 B$25.91$25.451,669,38512/31/211.81%10.98%
+NUAN4/12/21Microsoft Corp (MSFT)All Cash$19.7 B$56.00$55.052,071,16712/31/211.73%10.50%
+UFS5/11/21Paper Excellence (N/A)All Cash$3.02 B$55.50$54.59249,86712/31/211.67%10.14%
+ITMR9/13/21ZOLL Medical Corporation (N/A)All Cash$399.11 M$31.00$30.520,84412/31/211.64%9.97%
+ATH3/08/21Apollo Global Management, Inc. (APO)All Stock$6.01 B$88.42$87.01991,9901/31/221.62%6.48%
+MDP10/06/21IAC/InterActiveCorp and Gray Television, Inc. (IAC)All Cash$6.02 B$59.17$58.24485,23012/31/211.60%9.71%
+ISBC7/28/21Citizens Financial Group, Inc. (CFG)Cash Plus Stock$3.5 B$15.53$15.31,879,9946/30/221.52%2.30%
+ESBK10/04/21Community Bank System, Inc. (CBU)All Cash$82.8 M$23.10$22.761,2833/31/221.49%3.64%
+WBT7/14/21Ali Holding S.r.l. (N/A)All Cash$4.8 B$24.00$23.66654,9351/31/221.44%5.76%
+ATC7/01/21MKS Instruments, Inc. (MKSI)Cash Plus Stock$6.5 B$24.48$24.15718,49512/31/211.38%8.38%
+STFC7/12/21Liberty Mutual Holding Company Inc. (N/A)All Cash$2.48 B$52.00$51.3168,4433/31/221.34%3.27%
+GSKY9/15/21The Goldman Sachs Group (GS)All Stock$2.24 B$12.40$12.241,506,8103/31/221.31%3.19%
+PAE10/25/21Amentum Government Services Holdings LLC (N/A)All Cash$1.9 B$10.05$9.922,024,6913/31/221.31%3.19%
+PBCT2/22/21M&T Bank Corporation (MTB)All Stock$7.6 B$17.36$17.1420,798,48412/31/211.28%7.81%
+HBMD7/13/21F.N.B. Corporation (FNB)All Stock$418 M$20.97$20.7192,2461/31/221.26%5.04%
+PSXP10/27/21Phillips 66 (PSX)All Stock$14.5 B$37.39$36.941,558,9063/31/221.22%2.96%
+RBNC7/15/21United Community Banks, Inc. (UCBI)All Stock$517 M$34.29$33.8826,4413/31/221.21%2.94%
+PNM10/21/20Avangrid, Inc. (AGR)All Cash$8.05 B$50.30$49.75263,44412/31/211.11%6.73%
+KSU9/15/21Canadian Pacific Railway Limited (CP)Cash Plus Stock$30.44 B$313.22$310.25471,27812/31/210.96%5.83%
+DWSN10/25/21Wilks Brothers, LLC (N/A)All Cash$18.56 M$2.34$2.3271,97212/31/210.86%5.24%
+GNOG8/09/21DraftKings Inc. (DKNG)All Stock$1.52 B$17.01$16.87277,5593/31/220.80%1.95%
+FRTA2/22/21Quikrete Holdings, Inc. (N/A)All Cash$2.74 B$24.00$23.82111,35412/31/210.76%4.60%
+HRC9/02/21Baxter International Inc. (BAX)All Cash$12.4 B$156.00$154.9866,3413/31/220.71%1.73%
+PPD4/15/21Thermo Fisher Scientific Inc. (TMO)All Cash$20.9 B$47.50$47.172,557,45112/31/210.70%4.26%
+CXP9/07/21Pacific Investment Management Company LLC (N/A)All Cash$3.9 B$19.30$19.171,984,45212/31/210.68%4.13%
+ESXB6/03/21United Bankshares, Inc. (UBSI)All Stock$303.3 M$11.74$11.6660,18312/31/210.66%4.01%
+BMTC3/10/21WSFS Financial Corporation (WSFS)All Stock$976.4 M$46.63$46.3457,20612/31/210.62%3.79%
+FMBI6/01/21Old National Bancorp (ONB)All Stock$2.86 B$19.36$19.25303,1231/31/220.58%2.33%
+KDMN9/08/21Sanofi (SNY)All Cash$1.64 B$9.50$9.453,411,87312/31/210.53%3.22%
+INOV8/19/21Nordic Capital (N/A)All Cash$7.3 B$41.00$40.79625,5111/31/220.51%2.06%
+ENBL2/17/21Energy Transfer LP (ET)All Stock$7.2 B$8.17$8.14603,81512/31/210.42%2.53%
+CVA7/14/21EQT Infrastructure (N/A)All Cash$5.35 B$20.25$20.181,209,94512/31/210.35%2.11%
+RAVN6/21/21CNH Industrial N.V (CNHI)All Cash$2.1 B$58.00$57.82178,88512/31/210.31%1.89%
+KOR9/13/21AngloGold Ashanti Limited (N/A)All Cash$450 M$3.29$3.2870,3303/31/220.30%0.74%
+LMRK8/23/21Landmark Dividend LLC (N/A)All Cash$997.25 M$16.50$16.4737,74112/31/210.18%1.11%
+MGLN1/04/21Centene Corporation (CNC)All Cash$2.2 B$95.00$94.8396,47312/31/210.18%1.09%
+ANAT8/09/21Brookfield Asset Management Reinsurance Partners Ltd. (BAMR)All Cash$5.1 B$190.00$189.7155,0906/30/220.15%0.23%
+DSPG8/30/21Synaptics Incorporated (SYNA)All Cash$399.78 M$22.00$21.97214,42312/31/210.14%0.83%
+JMP9/08/21Citizens Financial Group, Inc. (CFG)All Cash$149 M$7.50$7.4928,39412/31/210.13%0.81%
+CAI6/17/21Mitsubishi HC Capital Inc. (N/A)All Cash$2.9 B$56.00$55.93159,59912/31/210.13%0.76%
+EBSB4/23/21Independent Bank Corp. (INDB)All Stock$1.15 B$23.24$23.21119,81612/31/210.12%0.72%
+VER4/29/21Realty Income Corporation (O)All Stock$17.66 B$50.36$50.329,395,63911/01/210.12%0.00%
+CNBKA4/07/21Eastern Bankshares, Inc. (EBC)All Cash$642 M$115.28$115.159,94212/31/210.11%0.69%
+FTSI10/22/21ProFrac Holdings (N/A)All Cash$407.5 M$26.52$26.5171,3463/31/220.08%0.18%
+ECHO9/10/21The Jordan Company, L.P. (N/A)All Cash$939.64 M$48.25$48.23505,86612/31/210.04%0.25%
+MNTV10/28/21Zendesk (ZEN)All Stock$4.21 B$22.91$22.926,671,6346/30/22-0.07%-0.10%
+ADMS10/11/21Supernus Pharmaceuticals, Inc. (SUPN)Special Conditions$460.12 M$8.10$8.11432,6101/31/22-0.12%-0.49%
+VEI8/10/21Chesapeake Energy Corporation (CHK)Cash Plus Stock$2.2 B$17.05$17.07772,13612/31/21-0.13%-0.78%
+QADA6/28/21Thoma Bravo (N/A)All Cash$2 B$87.50$87.64377,14812/31/21-0.16%-0.97%
+KL9/28/21Agnico Eagle Mines Limited (AEM)All Stock$9.53 B$42.10$42.171,536,5483/31/22-0.18%-0.43%
+SC8/24/21Santander Holdings USA, Inc. (N/A)All Cash$12.7 B$41.50$41.7310,13012/31/21-0.48%-2.92%
+TPG10/05/21Stonepeak (N/A)All Cash$6.2 B$17.00$17.10N/A12/31/21-0.58%-3.56%
+UMPQ10/12/21Columbia Banking System, Inc. (COLB)All Stock$4.5 B$20.33$20.452,223,1006/30/22-0.59%-0.90%
+XOG5/10/21Bonanza Creek Energy, Inc. (BCEI)All Stock$2.6 B$65.75$66.63261,38911/30/21-1.33%-16.71%
+ICBK6/22/21Nicolet Bankshares, Inc. (NCBS)All Stock$219 M$34.51$35.445,95512/31/21-2.52%-15.34%
+FLXN10/11/21Pacira BioSciences, Inc. (PCRX)Special Conditions$570.84 M$8.50$9.25852,85112/31/21-8.11%-49.32%


SPAC activity seems to be picking up pace once again with 57 SPAC IPOs filed in the month of October. SPAC business combinations continue to grow as well. One of the significant SPAC business combinations in October was the merger agreement between Trump Media & Technology Group and Digital World Acquisition (DWAC) to create a new social media network. DWAC skyrocketed after the announcement of this combination, highlighting the opportunities and pitfalls that lurk in SPACs.

Disclaimer: I have long positions in Nuance Communications (NUAN), Change Healthcare (CHNG) and Trillium Therapeutics (TRIL). I also have put options in Change Healthcare. 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.