Saturday, 7 January 2012

Mergers & Acquisitions - Week Ending 01/06/12

On Monday, French oil firm Total said it would buy a 25 percent stake in Chesapeake Energy's Ohio shale operation for $2.32 billion. They are expected to use the proceeds to reduce debt or for development. The buyer and seller were up 2.7% and 5.9% on Tuesday. The following day saw further action in the oil sector, with Sinopec International purchasing 30 percent of 5 shale projects being undertaken by Devon Energy. This $2.2 billion deal allows Devon to recover its initial outlay and reduce future capital commitments. The bidder and vendor gained 6.1% and 6.6% respectively.

Also that day, diversified technology firm 3M acquired the office and consumer products division of Avery Dennison for $550 million. Possible motives behind the deal include the target's product lines, retail branding and strong balance sheet. Both companies rose around 2.2%. On Thursday, FIAT increased its stake in Chrysler to 58.5 percent. This news comes after Chrysler got regulatory approval for a new energy efficient product line. The Italian auto manufacturer grew 3.3% by the bell.