Friday, 15 July 2011

Mergers & Acquisitions - Week Ending 15/07/11

Over the weekend, the news broke that Precision Castparts would buy aerospace manufacturer Primus International for $900 million. On Monday, the buyer, which engages in metal casting, was down 0.6%. Nestle purchased a 60% stake in Hsu Fu Chi, a Chinese confectioner, for $1.7 billion. Despite this deal dramatically increasing its presence in the Asian market, the Swiss food giant fell 1.1%. In pharmaceuticals, Arch Chemicals was bought for $1.2 billion by The Lonza Group. Arch was up 12.3% by the bell, exceeding the premium offered. Also that day, NCR acquired Radiant Systems, a retail and hospitality manufacturer, for $1.2 billion in an all-cash deal. This announcement was met with negative sentiment on the markets. The buyer, which produces self-service technologies, was down almost 1.9% while Radiant dropped 2.3%.

Tuesday saw Gaz Metro take over Central Vermont Public Service Corporation for $472 million, bringing Vermont’s two largest public utilities companies together. Central Vermont’s price fell by 2.6%, while Valener Inc., which has a significant stake in Gaz Metro, was up almost 1%. Also that day, it was announced that Electronic Arts would buy PopCap Games for $750 million in order to strengthen its position in the mobile gaming market. The buyer was down by almost 1%. The midweek saw Apollo Global Management purchase the Philadelphia 76ers basketball team for around $280 million. The private equity firm closed down 1.5%. The week’s final major deal came on Thursday in the energy sector. BHP Billiton bought Petrohawk for $12.1 billion in an all-cash deal as BHP look to increase their natural gas assets. The prices of both firms dropped by around 1.8%.