Merger Arbitrage Mondays – September 27, 2010

Merger activity continued to increase last week with eight new deals announced and one deal closing.

Deal Statistics:

Total Number of Deals Closed in 2010 70
Total Number of Deals That Did Not Complete in 2010 5
Total Number of Pending Deals
Cash Deals 53
Stock Deals 12
Stock & Cash Deals 13
Total Number of Pending Deals 78

New Deals:

  1. The acquisition of L-1 Identity Solutions (ID) by French aerospace and defense systems company Safran for $1.1 billion at $12 per share in cash
  2. The acquisition of Netezza Corp (NZ) by International Business Machines Corp (IBM) for $1.7 billion at $27 per share in cash
  3. The acquisition of Nu Horizons Electronics Corp (NUHC) by Arrow Electronics (ARW) for $130 million at $7 per share in cash
  4. The acquisition of Internet Brands (INET) by an affiliate of Hellman & Friedman Capital Partners for $640 million at $13.35 per share in cash
  5. The acquisition of RAE Systems (RAE) by an affiliate of Battery Ventures for $95 million at $1.60 per share in cash
  6. The acquisition of Cadence Financial Corporation (CADE) by Trustmark Corporation (TRMK) in an all-stock deal at  0.097 shares of Trustmark common stock for each share of Cadence
  7. The acquisition of Penn Virginia GP Holdings (PVG) by Penn Virginia Resource Partners (PVR) for $954 million in an all stock deal, where Penn Virginia GP Holdings unitholders will receive 0.98 units of Penn Virginia Resource Partners per Penn Virginia GP Holdings unit held
  8. The acquisition of Majestic Capital (MAJC) by Bayside Capital Partners for $7.8 million at $0.45 per share in cash


Modified Deals:

  1. BlueLinx Holdings (BXC) rose 15% to $3.92 a share in pre-market trades on Thursday after receiving an increased buyout offer of $4 a share from affiliates of Cerberus Capital Management L.P., up from an earlier offer of $3.40 a share.
  2. Avis Budget Group (CAR) increased its offer to acquire Dollar Thrifty (DTG) to about $1.52 billion, topping a sweetened offer from Hertz (HTZ) earlier this month.


Closed Deals:

  1. The acquisition of Boots & Coots (WEL) by Halliburton (HAL) on September 20, 2010


Top 10 Deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annu.
Profit
TLCR 06/07/2010 Grifols (GRF.MC) $28.37 $23.10 12/31/2010 22.81% 87.62%
MAJC 09/21/2010 Bayside Capital Partners (N/A) $0.45 $0.375 03/31/2011 20.00% 39.46%
SSE 02/23/2010 Naugatuck Valley Financial Corp (NVSL) $6.75 $5.78 12/31/2010 16.78% 64.48%
ADAM 08/30/2010 Ebix Inc. (EBIX) $7.18 $6.33 12/31/2010 13.44% 51.63%
AYE 02/11/2010 FirstEnergy (FE) $25.41 $24.04 03/31/2011 5.71% 11.27%
CADE 09/22/2010 Trustmark Corporation (TRMK) $2.11 $2.00 03/31/2011 5.34% 10.54%
PVG 09/21/2010 Penn Virginia Resource Partners (PVR) $23.96 $22.75 12/31/2010 5.32% 20.45%
BNE 02/24/2010 RR Donnelley (RRD) $11.50 $10.98 09/30/2010 4.74% 576.20%
Q 04/22/2010 Century Link (CTL) $6.53 $6.25 04/21/2011 4.50% 7.97%
BGH 06/11/2010 Buckeye Partners LP (BPL) $43.72 $41.95 12/31/2010 4.23% 16.25%

List of all Pending Deals:

  Symbol Announced
Date
Acquiring
Company
Closing
Value
Closing
Price
Last
Price
Closing
Date
Profit Annu.

Profit

+ TLCR 06/07/2010 Grifols (GRF.MC) $3.4 billion $28.36 $23.10 12/31/2010 22.78% 87.51%
+ MAJC 09/21/2010 Bayside Capital Partners (N/A) $7.8 million $0.45 $0.375 03/31/2011 20.00% 39.46%
+ SSE 02/23/2010 Naugatuck Valley Financial Corp (NVSL) $19.5 million $6.75 $5.78 12/31/2010 16.78% 64.48%
+ ADAM 08/30/2010 Ebix Inc. (EBIX) $66 million $7.18 $6.33 12/31/2010 13.44% 51.63%
+ AYE 02/11/2010 FirstEnergy (FE) $8.5 billion $25.41 $24.04 03/31/2011 5.71% 11.27%
+ CADE 09/22/2010 Trustmark Corporation (TRMK) $23.8 million $2.11 $2.00 03/31/2011 5.34% 10.54%
+ PVG 09/21/2010 Penn Virginia Resource Partners (PVR) $954 million $23.96 $22.75 12/31/2010 5.32% 20.45%
+ BNE 02/24/2010 RR Donnelley (RRD) $481 million $11.50 $10.98 09/30/2010 4.74% 576.20%
+ Q 04/22/2010 Century Link (CTL) $10.6 billion $6.53 $6.25 04/21/2011 4.50% 7.97%
+ BGH 06/11/2010 Buckeye Partners LP (BPL) $1.14 billion $43.72 $41.95 12/31/2010 4.23% 16.25%
+ SMTB 07/15/2010 People's United Financial Inc. (PBCT) $60 million $3.88 $3.74 12/31/2010 3.80% 14.61%
+ OCNW 09/16/2010 Calix Inc. (CALX) $171 million $7.64 $7.39 12/31/2010 3.45% 13.26%
+ NRGP 08/09/2010 Inergy (NRGY) $2.07 billion $29.57 $28.73 12/31/2010 2.92% 11.21%
+ ALY 08/12/2010 Seawell (N/A) $890 million $4.25 $4.13 12/31/2010 2.91% 11.16%
+ CCBP 08/09/2010 F.N.B. Corporation (FNB) $70 million $39.64 $38.57 12/31/2010 2.77% 10.65%
+ ID 09/20/2010 Safran (N/A) $1.1 billion $12.00 $11.69 03/31/2011 2.65% 5.23%
+ RAE 09/20/2010 Battery Ventures (N/A) $95 million $1.60 $1.56 12/31/2010 2.56% 9.85%
+ EPE 09/07/2010 Enterprise Products (EPD) $8 billion $58.17 $56.79 12/31/2010 2.43% 9.34%
+ OTIX 09/13/2010 William Demant (N/A) $50 million $8.60 $8.432 12/31/2010 1.99% 7.66%
+ DIVX 06/02/2010 Sonic Solutions (SNIC) $323 million $8.22 $8.08 09/30/2010 1.75% 213.52%
+ PRPX 02/17/2010 L.B. Foster Co. (FSTR) $112 million $11.80 $11.60 12/30/2010 1.72% 6.69%
+ MIR 04/12/2010 RRI Energy In. (RRI) $1.6 billion $10.06 $9.90 12/31/2010 1.66% 6.37%
+ OICO 09/14/2010 ITT Corporation (ITT) $29 million $12.50 $12.30 12/31/2010 1.63% 6.25%
+ ALOY 06/24/2010 ZelnickMedia (N/A) $126.5 million $9.80 $9.65 12/31/2010 1.55% 5.97%
+ NAL 08/19/2010 First Niagara Financial Group (FNFG) $1.5 billion $12.67 $12.48 05/15/2011 1.54% 2.44%
+ INET 09/20/2010 an affiliate of Hellman & Friedman Capital Partners (N/A) $640 million $13.35 $13.16 12/31/2010 1.44% 5.55%
+ MFE 08/19/2010 Intel Corporation (INTC) $7.68 billion $48.00 $47.32 12/31/2010 1.44% 5.52%
+ ME 04/15/2010 Apache (APA) $2.7 billion $24.52 $24.19 09/30/2010 1.38% 168.14%
+ ATAC 07/19/2010 Genco Distribution System Inc. (N/A) $513 million $25.00 $24.72 12/31/2010 1.13% 4.35%
+ OMNI 06/04/2010 Wellspring Capital Management (N/A) $122 million $2.75 $2.72 11/15/2010 1.10% 8.22%
+ XJT 08/04/2010 SkyWest (SKYW) $133 million $6.75 $6.68 12/31/2010 1.05% 4.03%
+ TUNE 09/08/2010 Zoran Corporation (ZRAN) $84 million $2.92 $2.89 12/31/2010 1.04% 3.99%
+ NUHC 09/20/2010 Arrow Electronics (ARW) $130 million $7.00 $6.93 12/31/2010 1.01% 3.88%
+ PTV 08/17/2010 Reynolds Group Holdings (N/A) $6 billion $33.25 $32.93 12/31/2010 0.97% 3.73%
+ LSBX 07/15/2010 People's United Financial Inc. (PBCT) $96 million $21.00 $20.80 12/31/2010 0.96% 3.69%
+ WAIN 06/29/2010 Eastern Bank (N/A) $163 million $19.00 $18.821 12/31/2010 0.95% 3.65%
+ MAM 03/12/2010 Emera Inc (N/A) $75.7 million $45.00 $44.595 12/31/2010 0.91% 3.49%
+ BKC 09/02/2010 3G Capital (N/A) $3.26 billion $24.00 $23.81 12/31/2010 0.80% 3.07%
+ OSTE 08/17/2010 Medtronic (MDT) $123 million $6.50 $6.45 12/31/2010 0.78% 2.98%
+ PSYS 05/17/2010 Universal Health (N/A) $3.1 billion $33.75 $33.50 12/31/2010 0.75% 2.87%
+ ADCT 07/13/2010 Tyco Electronics (TEL) $1.24 billion $12.75 $12.66 12/31/2010 0.71% 2.73%
+ CLU 09/16/2010 Clearwater Paper Corporation (CLW) $247 million $12.00 $11.93 12/31/2010 0.59% 2.25%
+ ACF 07/22/2010 General Motors Co. (N/A) $3.5 billion $24.50 $24.37 12/31/2010 0.53% 2.05%
+ AMPH 09/01/2010 ProAssuarance (PRA) $233 million $32.50 $32.35 12/31/2010 0.46% 1.78%
+ PPCO 08/09/2010 Endo Pharmaceuticals (ENDP) $144 million $5.00 $4.98 12/31/2010 0.40% 1.54%
+ STU 09/17/2010 Discover Financial Services (N/A) N/A $30.00 $29.89 12/31/2010 0.37% 1.41%
+ RSCR 09/07/2010 Onex Corp (N/A) $390 million $13.25 $13.21 12/31/2010 0.30% 1.16%
+ DTPI 08/24/2010 PricewaterhouseCoopers (N/A) $378 million $12.50 $12.47 12/31/2010 0.24% 0.92%
+ GLG 05/17/2010 Man Group (N/A) $1.6 billion $4.50 $4.49 09/30/2010 0.22% 27.10%
+ PMACA 06/10/2010 Old Republic International (ORI) $228 million $7.50 $7.48 09/30/2010 0.22% 26.84%
+ ARST 09/13/2010 Hewlett-Packard Company (HPQ) $1.5 billion $43.50 $43.41 12/31/2010 0.21% 0.80%
+ ZGEN 09/07/2010 Bristol Myers Squibb Company (BMY) $885 million $9.75 $9.73 12/31/2010 0.21% 0.79%
+ HEW 07/12/2010 Aon Corp (AON) $4.9 billion $50.71 $50.62 11/15/2010 0.17% 1.30%
+ NTY 07/15/2010 The Carlyle Group (N/A) $3.8 billion $55.00 $54.94 12/31/2010 0.11% 0.42%
+ AEZ 07/28/2010 Hess Corp (HES) $450 million $7.94 $7.93 12/31/2010 0.09% 0.35%
+ MEND 07/12/2010 Johnson & Johnson (JNJ) $480 million $23.40 $23.38 09/30/2010 0.09% 10.41%
+ ACAP 07/08/2010 The Doctors Company (N/A) $386 million $41.50 $41.50 12/31/2010 0.00% 0.00%
+ HGRD 07/28/2010 an affiliate of the private equity firm Vestar Capital (N/A) $294 million $8.20 $8.20 09/30/2010 0.00% 0.00%
+ SLRY 09/01/2010 Kenexa Corp. (KNXA) $80 million $4.07 $4.07 12/31/2010 0.00% 0.00%
+ NYM 07/15/2010 ProSight (N/A) $230 million $25.75 $25.78 12/31/2010 -0.12% -0.45%
+ CAL 05/03/2010 United (UAUA) $1.2 billion $23.93 $23.96 12/31/2010 -0.13% -0.49%
+ VRX 06/21/2010 Biovail Corporation (BVF) $3.3 billion $65.05 $65.16 12/31/2010 -0.17% -0.65%
+ UNCA 08/13/2010 IBM (IBM) $480 million $21.00 $21.04 12/31/2010 -0.19% -0.73%
+ DTG 04/26/2010 Hertz (HTZ) $1.56 billion $50.70 $51.03 12/31/2010 -0.64% -2.45%
+ DYN 08/13/2010 Blackstone Group (BX) $4.7 billion $4.50 $4.53 12/31/2010 -0.66% -2.54%
+ ICXT 08/16/2010 FLIR Systems (FLIR) $274 million $7.55 $7.61 12/31/2010 -0.79% -3.03%
+ NZ 09/20/2010 International Business Machines (IBM) $1.7 billion $27.00 $27.46 12/31/2010 -1.68% -6.44%
+ PZZ 08/16/2010 Leonard Green & Partners (N/A) $363 million $8.50 $8.67 12/31/2010 -1.96% -7.53%
+ COGT 08/30/2010 3M Co. (MMM) $943 million $10.50 $10.74 12/31/2010 -2.23% -8.59%
+ PTEC 08/17/2010 Marlin Equity Partners (N/A) $139 million $3.85 $3.95 12/31/2010 -2.53% -9.73%
+ PTEC 08/17/2010 Marlin Equity Partners (N/A) $139 million $3.85 $3.95 12/31/2010 -2.53% -9.73%
+ TSFG 05/17/2010 TD Bank Financial Group (N/A) $61 million $0.28 $0.29 09/30/2010 -3.45% -419.54%
+ ABII 06/30/2010 Celgene (CELG) $2.9 billion $73.30 $76.68 12/31/2010 -4.41% -16.94%
+ TRBN 08/12/2010 Emergent BioSolution (EBS) $96.8 million $4.37 $4.5685 12/31/2010 -4.42% -17.00%
+ PAR 08/28/2010 Hewlett-Packard Company (HPQ) $2 billion $30.00 $32.98 12/31/2010 -9.04% -34.72%
+ ATBC 05/10/2010 Jacksonville Bancorp (JAXB) N/A $2.18 $2.44 12/31/2010 -10.82% -41.57%
+ BXC 07/22/2010 Cerberus Capital Management (N/A) $111.1 million $3.40 $3.97 12/31/2010 -14.36% -55.16%
+ CCE 02/25/2010 The Coca-Cola Company (KO) $12.3 billion N/A $30.20 10/01/2010 N/A N/A

Contributing Author: Ann Kumar

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