Friday, 25 May 2012

Mergers & Acquisitions - Week Ending 05/25/12

Over the weekend, it was announced that the Alibaba Group would buy $7.1 billion of its own stock back from Yahoo, equating to around half of Yahoo’s 40 percent stake in the Chinese website. It is believed that the struggling internet firm will use the money to buy back stock in an attempt to improve its dwindling price. The seller gained 1% on Monday. Setting the pace for what was a hectic day deal-wise, DaVita purchased HealthCare Partners, a firm which runs several medical groups, for $4.4 billion. This move is part of DaVita’s plan to expand westward and into parts of Florida. The dialysis clinics operator jumped 5% on the news. The Dalian Wanda Group of China acquired AMC Entertainment for $2.6 billion. This deal will create the world’s largest theatre operator, and many believe it will strengthen Chinese influence on American film. The Chinese real estate giant already had large interests in the entertainment industry. It was announced that Barclays would sell its $6.1 billion stake in BlackRock, with as much as $1 billion of that being bought back by the investment manager. This comes amid talk that banks won’t be able to maintain such risky investments when the new Basel III regulations take effect. The British bank was up 3.8%, as BlackRock lost 2.4%. Power management firm Eaton Corporation absorbed Cooper Industries for $11.8 billion. By adding electrical equipment to its product line, the buyer believes that it can create a global electricity group. The power management firm dropped 0.7%, as Cooper soared over 25%, mirroring the premium being offered.

The following day, Accor sold its American hotel unit to Blackstone Group for $1.9 billion. The spin off comes as the French hotel chain looks to focus on emerging economies and Europe. This deal was met positively on the markets; with the vendor and the private equity firm gaining 5.8% and 2.5% respectively. Also that day, SAP took over rival Ariba for $4.5 billion. They become the latest firm to invest in the cloud market, with the enterprise software giant expecting the industry to “redefine network innovation”. The bidder was relatively unchanged, while Ariba spiked almost 20%. The midweek saw PTT Exploration and Production beat Shell at the post to acquire Cove Energy for $1.91 billion. The backdrop of this battle is the promise of East African gas finds for which the target is heavily involved. Cove was boosted over 11%. Surprisingly, the snubbed Dutch company was elevated 0.8% as the state-owned Thai energy group lost 2%. Also that day, Seagate bought a majority stake in rival LaCie for $186 million. The French group will add a premium edge to Seagate’s mass-driven offerings. The buyer fell 4.2%, while LaCie was 1.8% higher by closing. On Thursday, Global Blue was procured by Silver Lake, a private equity firm and Partners Group, an investment management company. The tax-free shopping outfit was chosen as a way to profit from the growing luxury travel market. Also that day, Lehman Holdings purchased the remainder of real estate group Archstone for $1.58 billion. The group, which owns many apartment developments, is expected to aide the downtrodden financial firm in repaying creditors.

Friday, 18 May 2012

Mergers & Acquisitions - Week Ending 05/18/12

On Monday, Concho Resources purchased the Three Rivers Operating Company for $1 billion. This news, which continues the strong trend of energy deals, will give Concho access to 1,500 new drilling locations in the Southern US. Prior to the deal, the target had been planning to go public. The oil and gas company gained 3.2%. Also that day, Ally Financial's mortgage unit filed for bankruptcy. It is believed that ResCap has long weighed down its parent's otherwise profitable financial operations.
On Thursday, Sears Holdings announced that it would divest 44 percent of its 95 percent stake in Sears Canada, a unit which has been seemingly holding it back as it looks to recover in a tough environment. This deal, will also free up cash for the ailing retailer, includes a caveat that hints towards further spinoffs. The seller was up over 3%, while Sears Canada fell almost 13%. Also that day, Agilent Technologies bought cancer diagnostics company Dako for $2.2 billion. The bidder is looking to strengthen its presence in the life sciences industry. The scientific instruments maker was down 0.3%.

Friday, 11 May 2012

Mergers & Acquisitions - Week Ending 05/11/12

Following a very lively previous week, this week saw only two deals. The first came on Monday, when two groups; hedge fund Perry Capital and private equity firm Yucaipa Companies, took over Barneys New York in exchange for quashing $540 million in debt (exchanging bonds for equity). The high-end retailer has been struggling with debt and dwindling demand following the credit crunch.
The only other deal of the week came the following day, when the Asahi Group acquired Calpis, a milk producer, for $1.5 billion. The buyer is looking to diversify to combat poor numbers in its core business, beer. The Japanese firm was down 1.4%.

Friday, 4 May 2012

Mergers & Acquisitions - Week Ending 05/04/12

On Monday, Energy Transfer Partners purchased Sunoco for $5.3 billion. This, the latest deal in America’s thriving energy sector, is focused on increasing the ETP’s presence in the distribution of oil and natural gas. The pipeline operator was up 3.6% while Sunoco jumped 21%, reflecting the large premium being offered. Microsoft announced that it would take a 17.6 percent stake in Barnes & Noble’s ‘Nook’ for $300 million. They are looking to capitalise on the rapid growth of the physical tablet business. The software giant was relatively unchanged as the book seller soared 52%. Hologic, the medical equipment maker, absorbed Gen-Probe in a $3.72 billion move. This is part of a wider strategy by Hologic to grow its budding diagnostics unit. The buyer was down 10% (on unrelated news of a lawsuit) while the diagnostics firm was boosted 18.7%. Also that day, Terra Firma Capital Partners bought Four Seasons Healthcare, a nursing home operator, for $1.3 billion. The private equity firm believe that, with less debt, the target has the potential to lead the industry. 

The following day, Mitsui and Mitsubishi acquired a 15 percent stake in an Australian natural gas project owned by Woodside Petrolium for $2 billion. This comes as many Japanese energy companies have been looking for alternatives following the shut down of several nuclear plants in the wake of the Fukishima disaster. The seller increased by 3.7% as Misui and Mitsubishi, both large divsersified groups, fell 1.8% and 2.1% respectively. The day also saw two large retail deals. The first came when shoe company Collective Brands was split in two in a $2 billion deal. The Performance & Lifestyle unit being purchased by Wolvereine Worldwide and Payless ShoeSource /Collective Licencing by Blum Capital and Golden Gate, both privite equity firms. The target grew 1.9% while the apparel maker dropped 4.4%. The other came in women's clothing when Charming Shoppes was integrated into its rival, Ascena Retail Group, for $890 million. The success of Ascena's Lane Bryant chain for plus-sized women is likely to have driven the acquisition. The buyer was relatively unchanged as Ascena was knocked 6.9%.

The midweek saw action in pharmaecuticals, as Novartis purchased Fougera Pharmaecuticals for $1.5 billion in cash. This is expected to create the world's largest generic skincare company, with significant synergies in sales and costs. Novartis lost 1.2%. 
On Thursday, China's Bright Foods Group took majority control over Weetabix from Lion Capital for $1 billion. They state-owned firm believe that the British brand has exciting international growth prospects. Also that day, BG Group sold its 60 percent stake in Comgas, a Brazillian gas company, to Cosan for $1.8 billion. The British energy firm are looking to free up cash with which to invest globally. The deal was met with negative sentiment on the markets, with BG and the sugar and ethanol producer down 1.8% and 1% respectively.