Merger Arbitrage Mondays – Saint-Gobain Acquires GCP Applied Technologies

  • December 13, 2021

Merger activity increased last week with three new deals announced and two deals completed. Two of the three new deals announced last week were potential deals in the works.

Founded in 2015, and headquartered in Alpharetta, Georgia, GCP Applied Technologies (GCP) produces and sells concrete and cement additives, building materials and technologies. The company operates through two operating segments: The Specialty Construction Chemicals (“SCC”) operating segment, which provides products, services and technologies to the concrete and cement industries and the Specialty Building Materials (“SBM”) operating segment, which manufactures and markets sheet and liquid membrane systems that protect structures from water, air and vapor penetration, as well as fireproofing and other products designed to protect the building envelope.

The company was severely impacted by cost inflation, raw material prices and logistics and supply chain disruptions during the pandemic.

We added GCP to our list of potential deals on December 1, 2021, when Bloomberg reported that French building materials maker Cie. de Saint-Gobain was among suitors considering a potential acquisition of GCP Applied Technologies. It was also reported that the company could attract takeover interest from other rivals including RPM International (RPM). On December 6, 2021, GCP entered into a definitive agreement to be acquired by Saint-Gobain for $32 per share, representing a premium of 21.12% to GCP’s unaffected closing stock price on December 1, 2021. The tiny 0.72% spread on the deal despite this being a cross-border deal with a closing date well into 2022, implies the market might be expecting a competing offer for the company. If the company considers a superior proposal, it will have to pay a termination fee of $71 million according to the merger agreement.

We added Mimecast Limited (MIME) to our list of potential deals on October 27, 2021. The price of MIME following this announcement was $75.16. On December 7, 2021, the company agreed to be acquired by Permira for $80 per share in cash, representing a premium of of approximately 16% to Mimecast’s unaffected closing stock price on October 27, 2021.

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

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

SPAC Arbitrage

There were 19 SPAC IPOs filed and 6 new SPAC business combinations announced last week. You can find the new SPAC IPO announcements in our SPACs tool here.

  1. Alvotech Holdings S.A., a global biopharmaceutical company focused solely on the development and manufacture of biosimilar medicines for patients worldwide, and Oaktree Acquisition Corp. II (OACB) have entered into a definitive merger agreement.
  2. The Tomorrow Companies, developer of a leading platform for global weather and climate security, and Pine Technology Acquisition (PTOC) announced they have entered into a definitive merger agreement.
  3. Aerami Therapeutics Holdings, a biopharmaceutical company focused on developing inhaled therapies to treat severe respiratory and chronic diseases, and FoxWayne Enterprises Acquisition (FOXW) announced they have entered into a definitive business combination agreement.
  4. Grove Collaborative, a sustainable consumer products company, and Virgin Group Acquisition Corp. II (VGII) have entered into a definitive business combination agreement.
  5. Getty Images, a visual content creator and marketplace, announced it has entered into a business combination agreement with CC Neuberger Principal Holdings II (PRPB).
  6. Corcentric, a provider of payments, accounts payable, and accounts receivable technology to enterprise and middle-market companies, and North Mountain Merger Corp. (NMMC) announced that they have entered into a definitive agreement to consummate a business combination.

Weekly Spread Changes:

The table below shows weekly spread changes between December 3 and December 10, 2021.


Company Quote
Last Week
Spread Change
JOBS49.89Garnet Faith Limited (N/A)58.45%41.16%17.29%All Cash
RRD11.12Atlas Holdings LLC (N/A)-6.92%-20.60%13.68%All Cash
AZPN147Emerson Electric Co. (EMR)92.598.84%5.55%3.29%Special Conditions
MX17.26South Dearborn Limited (N/A)68.02%66.00%2.02%All Cash
PTRS9.52OceanFirst Financial Corp. (OCFC)21.119.03%7.23%1.80%Special Conditions
CHNG20.6UnitedHealth Group Incorporated (UNH)478.2325.00%26.66%-1.66%All Cash
FCCY24.02Lakeland Bancorp, Inc. (LBAI)17.810.67%2.38%-1.71%All Stock
NFH11.61Unicorn II Holdings Limited (N/A)3.36%5.26%-1.90%All Cash
XLNX217.18Advanced Micro Devices, Inc. (AMD)138.559.94%14.34%-4.40%All Stock
MNTV21.45Zendesk (ZEN)100.575.49%15.27%-9.78%All Stock

Deal Statistics:

Total Number of Deals Closed in 2021186
Total Number of Deals Not Completed in 202114
Total Number of Pending Deals
Cash Deals48
Stock Deals27
Stock & Cash Deals6
Special Conditions4
Total Number of Pending Deals85
Total Deal Size$1.02 trillion

New Deals:

  1. The acquisition of GCP Applied Technologies (GCP) by Saint-Gobain for $2.3 billion or $32 per share in cash. We added GCP as a potential deal to the Deals in the Works section on December 1, 2021, and the price after the news of the potential deal came out was $26.64.
  2. The acquisition of Del Taco Restaurants (TACO) by Jack in the Box (JACK) for $575 million or $12.51 per share in cash. JACK was keen on eating its TACO because it was willing to pay a premium of over 66% for the deal.
  3. The acquisition of Mimecast Limited (MIME) by Permira for $5.8 billion or $80 per share in cash. We added MIME as a potential deal to the Deals in the Works section on October 27, 2021, and the price after the news of the potential deal came out was $75.16.

Deal Updates:

  1. On December 6, 2021, FTS International (FTSI) announced the expiration of the 45-day “go-shop” period under the terms of the previously announced merger agreement.
  2. On December 7, 2021, Lakeland Bancorp (LBAI) and 1st Constitution Bancorp (FCCY) announced the receipt of their respective shareholder approvals in connection with the proposed merger of 1st Constitution with and into Lakeland.
  3. On December 8, 2021, Reliant Bancorp (RBNC) announced that its stockholders approved the proposed acquisition by United Community Banks (UCBI).
  4. On December 9, 2021, New Mexico utility regulators voted to reject Avangrid (AGR) proposed acquisition of PNM Resources (PNM), saying the deal’s risks outweighed its promised benefits to state ratepayers.
  5. On December 9, 2021, R. R. Donnelley & Sons Company (RRD) announced that it has accepted a proposal from affiliates of Atlas Holdings to increase the price per share of their pending acquisition of RRD to $10.35 per share in cash. Following which, Chatham Asset Management submitted an increased binding, fully financed offer to acquire all the shares of R.R. Donnelley & Sons Company (RRD) not already owned by Chatham for $10.85 per share in cash.
  6. On December 9, 2021, Landmark Infrastructure Partners (LMRK) announced that holders of a majority of the common units of the Partnership, voted to approve the acquisition of the Partnership by the Partnership’s sponsor, Landmark Dividend LLC.
  7. On December 9, 2021, Kraton Corporation (KRA) announced that its stockholders approved the proposed acquisition of Kraton Corporation by DL Chemical.
  8. On December 10, 2021, Santander Holdings USA announced that it has extended the expiration date of its previously announced tender offer to acquire all outstanding shares of common stock of Santander Consumer USA Holdings (SC). As a result of this extension, the Tender Offer is now scheduled to expire on December 16, 2021.
  9. On December 10, 2021, Kansas City Southern (KSU) announced that the company’s stockholders have voted to approve the previously announced combination with Canadian Pacific Railway Limited (CP).
  10. December 10, 2021: According to Reuters, Microsoft (MSFTis set to secure unconditional EU antitrust approval for its bid for Nuance Communications (NUAN).

Closed Deals:

  1. The acquisition of PPD, Inc. (PPD) by Thermo Fisher Scientific (TMO) on December 8, 2021. It took 237 days for this deal to be completed.
  2. The acquisition of Columbia Property Trust (CXP) by Pacific Investment Management Company on December 8, 2021. It took 92 days for this deal to be completed.

Top 10 deals with largest spreads:

MX03/26/2021South Dearborn Limited (N/A)$29.00$17.2612/31/202168.02%1306.67%
JOBS06/21/2021Garnet Faith Limited (N/A)$79.05$49.8912/31/202158.45%1122.83%
CHNG01/06/2021UnitedHealth Group Incorporated (UNH)$25.75$20.602/28/202225.00%116.99%
AJRD12/20/2020Lockheed Martin Corporation (LMT)$51.00$42.5903/31/202219.75%66.12%
SOLY05/10/2021Allergan Aesthetics (N/A)$22.60$20.1303/31/202212.27%41.09%
PNM10/21/2020Avangrid, Inc. (AGR)$50.30$45.5612/31/202110.40%199.86%
XLNX10/27/2020Advanced Micro Devices, Inc. (AMD)$238.78$217.1812/31/20219.94%191.04%
SJR03/15/2021Rogers Communications Inc. (RCI)$32.40$29.5206/30/20229.76%17.80%
PTRS11/04/2021OceanFirst Financial Corp. (OCFC)$10.38$9.5206/30/20229.03%16.49%
AZPN10/11/2021Emerson Electric Co. (EMR)$160.00$14706/30/20228.84%16.14%

List of all pending deals:

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


Multiple active deals continued to receive required approvals for the successful completion of their transactions. The bidding war for R. R. Donnelley & Sons Company (RRD) continued last week with RRD accepting an increased proposal from Atlas Holdings and Chatham further increasing its bid for the company. Little did we expect multiple rounds of bidding for R. R. Donnelley after a merger agreement was inked. In a market starved for good investment opportunities and interest rates still close to all time lows, we are likely to see more of these bidding wars, providing arbitrageurs with upside that is not the norm in the risk arbitrage world.

Disclaimer: I have long positions in Magnachip Semiconductor (MX), Nuance Communications (NUAN) and Change Healthcare (CHNG). 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.