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Merger and acquisition activity continues to heat up with 5 new mergers announced last week and two deals closing. The pace of merger activity over the last few weeks combined with an uptick in IPOs (5 new offerings were filed last week) and heavy insider selling have me very worried about this market.

On a positive note, Carl Icahn raised his offering price for SINLetter model portfolio holding Lions Gate Entertainment (NYSE:LGF) from $6 to $7/share. In an interesting twist another billionaire Mark Cuban disclosed a 5.4% stake in Lions Gate. It remains to be seen if Mr. Cuban plans on making a rival bid for Lions Gate given his interest in the film and media business through stakes in Landmark Theatres and HDNet.

The five new deals include the acquisition of DynCorp International (DCP) by Cerberus Capital Management for $17.55 in cash per share, the acquisition of Mariner Energy (ME) by Apache Corporation for $25.77 per share in a cash plus stock deal, the acquisition of Phase Forward (PFWD) for $17 in cash per share by Oracle, the acquisition of Dialysis Corporation of America (DCAI) for $11.25 in cash per share by U.S. Renal Care and the acquisition of Mirant Corporation (MIR) for $11.71 per share in an all stock transaction by RRI Energy to form GenOn Energy.

The two deals that closed last week include the acquisition of Terra Industries (TRA) by CF Industries Holdings and the acquisition of Peco II Inc. (PIII) by Lineage Power Holdings Inc.

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Source: Merger Arbitrage Mondays: April 19, 2010