Merger activity remained steady last week with two new deals announced and four deals completed. With two deals announced each week, there have been a total of eight new deals announced so far in the month of January.
You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.
There were five new deals announced in the Deals in the Works section last week.
We added Centene Corporation (CNC) as a potential deal in the works on January 26, 2022, after Bloomberg reported that Centene had been drawing takeover interest from Cigna Corporation (CI) in recent months. In the past couple of years, we tracked the acquisitions of WellCare Health Plans and Magellan Health by Centene. Before completing the acquisition of WellCare Health Plans in 2019, Dan Loeb’s Third Point and activists Corvex and Sachem Head were encouraging Centene to sell itself. The deal could face hurdles in the current challenging regulatory and competitive environment. Wells Fargo analyst Stephen Baxter said in a note , “While this could certainly be revisited, at this point we see more potential obstacles than obvious reasons to push forward. These include relatively modest accretion, CI’s historical ambivalence toward Medicaid, the disconnect between CNC’s current profitability and long-term earnings power, and antitrust concerns.”
Another potential deal in the works that we added last week was DouYu (DOYU). We tracked the acquisition of DOYU by Huya (HUYA) from the announcement in October 2020 until China’s market regulator blocked Tencent Holdings’s plan to merge the country’s top two videogame streaming sites, on antitrust grounds in mid-2021. After the announcement of two of the biggest gaming industry deals in history in January including the acquisition of Zynga by Take-Two and Activision by Microsoft, Tencent Holdings, owner of games like ‘Honor of Kings’ and ‘PUBG’, announced that it plans to take DouYu private in order to have a firm grip on its core gaming affiliates. Tencent already holds a 37% stake in DouYu and might have better luck taking the company private than it did with attempting to merge it with Huya. DouYu’s stock is down an astounding 84% during the last year.