Friday, 1 June 2012

Mergers & Acquisitions - Week Ending 06/01/12

The week’s first deal came on Tuesday, when Marubeni bought Gavilon Group for $3.6 billion. Encouraged by a strong Yen, the buyer will be looking to import the grain producer’s product to the Asian market. The Japanese trading firm gained 2.6%. Also that day, P2 Capital Partners and GS Capital Partners, the private equity arm of Goldman Sachs, purchased Interline Brands for $1.1 billion. The management team of the supplier of professional contractors is also expected to invest as part of the deal. The investment bank was up 1.2% as target soared almost 40%, exceeding the premium offered. The midweek saw RIT Capital Partners buy a 37 percent stake in Rockefeller Financial Services for an undisclosed fee. The deal, which will see two famous banking families, the Rothschilds and the Rockefellers, join forces, is based on the investment trusts collaborating in areas of expertise. The British firm was relatively unchanged.

On Thursday, tech company CGI Group absorbed British rival Logica for $2.6 billion. The move is expected to give CGI access to European markets as part of their plan to expand internationally. The move was met extremely positively; the buyer was boosted 13% while Logica was boosted 67%, exceeding the premium offered. Also that day, private equity firm Sycamore Partners acquired Talbots for $369 million. This comes as a surprise, considering the struggling women's retailer rejected several higher offers in the past; a plummeting share price may have provided a reality check. Their share price soared almost 90% on the news. The following day, Verizon Communications announced that it would buy Hughes Telematics, which provides wireless systems for vehicles, for $612 million in an all-cash deal. This comes as telecoms companies are looking to find new income streams. The telecoms giant was down 1.5%, as Hughes spiked 171%, mirroring the massive premium being paid.