Viagra Maker Pfizer Wants Some Love

| About: Pfizer Inc. (PFE)

Summary

Pfizer: You Just Don't Appreciate Me.

MetLife breaking up.

Del Frisco’s a juicy deal target?

Welcome to the Underappreciated issue of M&A Daily.

Sifting the World Update

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Pfizer

Pfizer (NYSE:PFE) management believes that the medical benefits of combining their pipeline of drugs with Allergan (NYSE:AGN) are underappreciated due to the focus on the financial structure of the deal and its related tax issues. The $40.66 net arbitrage spread offers a 13% annual return if the deal closes by yearend. Pfizer CEO Ian Read spoke about the deal at the JPMorgan (NYSE:JPM) healthcare conference,

Both companies have a small degree of overlap, not a large degree of overlap in the therapeutic areas. The transaction is a lot more about growth - getting growth in the innovative business, strengthening the established business and then allowing us to allocate our capital efficiently around the world.

So, we set a target that we felt we could achieve on the synergies which is more than $2 billion and it reflects the lack of overlap and the fact that both companies have been - I think extremely good at taking cost out or you know - take my capital to Brent in a way he has managed his integration of companies and I think Pfizer has taken out more fixed cost from its base than almost any other company or combination of companies in the last five years.

So I think it reflects that and it reflects that this transaction is about growth and about great capital allocation and it's not about synergy cuts although we will get all synergies we can.

Keurig

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The definitive proxy was filed for the JAB acquisition of Keurig (NASDAQ:GMCR). The Keurig shareholder vote is on February 24th. The $1.77 net arbitrage spread offers a 15% annual return if the deal closes by March.

Wausau

A memorandum of understanding on outstanding shareholder litigation was filed for the Wausau (NYSE:WPP) acquisition by Svenska Cellulosa (OTCPK:SVCBY).

KLA-Tencor

The first S-4 amendment has been filed for the Lam (NASDAQ:LRCX) acquisition of KLA-Tencor (NASDAQ:KLAC). The shareholder vote is on February 19th.

COM DEV

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COM DEV (OTCPK:CDVIF) announced that key regulatory and consent conditions required in order to complete its acquisition by Honeywell (NYSE:HON) have been satisfied. The companies have secured HSR and Investment Canada clearance.

Yadkin

The final proxy for the Yadkin (NYSE:YDKN) acquisition of NewBridge (NASDAQ:NBBC) is effective.

Lexmark

Lexmark (NYSE:LXK) is working with Goldman Sachs (NYSE:GS) to separately sell its hardware and software assets. One potential asset buyer could be Xerox (NYSE:XRX).

MetLife

MetLife (NYSE:MET) is separating off its US retail business. The company is evaluating options such as an IPO, spin-off, or a sale.

Time Warner

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Time Warner (NYSE:TWX) CEO Jeff Bewkes is open to selling the company for the right price, but his price expectations appear to be high (as in triple digits). More to come in future editions of M&A Daily

Elsewhere on Seeking Alpha

Disclosure: I am/we are long AGN, GMCR, TWX, DFRG.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Chris DeMuth Jr and Andrew Walker are portfolio managers at Rangeley Capital. Rangeley invests with a margin of safety by buying securities at deep discounts to their intrinsic value and unlocking that value through corporate events. In order to maximize total returns for our investors, we reserve the right to make investment decisions regarding any security without further notification except where such notification is required by law.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.