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Alexander Shadunsky began his career in business at a young age, when he became a part of the family newspaper business. After a brief stint in retail, he developed an interest in value investing and has been uncovering undervalued opportunities ever since. He is a regular reader of Seeking... More
  • 5 Stocks Posting Big Rallies On Wednesday 0 comments
    Dec 21, 2011 8:34 PM | about stocks: DFG, MY, DCTH, CMFB, SASR, FRBK

    These five stocks posted big gains on Wednesday, led by two financials following M&A announcements.

    Delphi Financial Group (NYSE:DFG)
    rose 73% after it and Tokio Marine Holdings (TMHD) and announced that they have entered into a definitive agreement under which TMHD will acquire all outstanding shares of Delphi, a leading financial services holding company comprised of specialty life and property & casualty insurance and insurance-related businesses, for $43.875 per Class A share and $52.875 per Class B share in cash, through TMHD's wholly owned subsidiary, Tokio Marine & Nichido Fire Insurance (TMNF). In addition, Delphi shareholders will receive $1.00 in cash per share pursuant to a one-time special dividend from Delphi for each share of Class A and Class B stock they own. The total transaction value is approximately $2.7 billion and is expected to close in the second quarter of 2012.

    This acquisition is priced at 12.7x DFG’s FY11 EPS and 11.6x FY12 estimated EPS. The acquisition values DFG at 0.8x price to book.

    China Ming Yang Wind Power Group Limited (NYSE:MY), a leading wind turbine manufacturer in China, jumped 19% after it announced its intention to continue purchasing shares pursuant to its previously announced share repurchase program.

    In addition, the company also announced that today Mr. Chuanwei  Zhang , Chairman and Chief Executive Officer of Ming Yang has initiated a program to purchase Ming Yang American Depository Shares on the open market.

    Under the program, Ming Yang is authorized to repurchase up to $50 million worth of issued and outstanding ADSs representing Ming Yang 's ordinary shares in the open market or in negotiated transactions, from time to time, depending on market conditions and other factors as well as subject to relevant rules under Untied States securities regulations. The share repurchase program will be funded by the Company's available working capital. As of September 30, 2011, the company had cash and cash equivalents of approximately $227.4 million.

    Delcath Systems (NASDAQ:DCTH) rose 22% after it appointed Gregory Gores, M.D. to the company's Medical Advisory Board. Dr. Gores is the Reuben R. Eisenberg Endowed Professor in Gastroenterology and Hepatology, professor of Medicine, and chair of the Division of Gastroenterology and Hepatology at the Mayo Clinic in Rochester, Minnesota . His research is focused on the fundamental mechanisms underpinning cell death in the liver, employing models relevant to human disease. He has published more than 400 original articles, chapters, reviews, and editorials. Dr. Gores serves on the editorial boards for the American Journal of Physiology, American Journal of Gastroenterology, and Nature Reviews in Clinical Gastroenterology and Hepatology and is a past Associate Editor for Hepatology.

    CommerceFirst Bancorp (NASDAQ:CMFB) jumped 70% after it and Sandy Spring Bancorp (NASDAQ:SASR) announced the execution of a definitive merger agreement for Sandy Spring to acquire CommerceFirst Bancorp and its wholly-owned subsidiary, CommerceFirst Bank, in a transaction currently valued at approximately $25.4 million in stock and cash. Sandy Spring 's acquisition of CommerceFirst will add approximately $205 million in total assets, $181 million in gross loans, and $180 million in total deposits, before purchase accounting adjustments. The transaction will expand Sandy Spring 's presence in Anne Arundel , Howard and Prince George's counties in central Maryland , where CommerceFirst Bank operates 5 full service branches.

    Under the terms of the agreement, Sandy Spring will acquire all of the shares of CommerceFirst common stock for a combination of 50% Sandy Spring common stock and 50% cash. The stock consideration will be at a fixed exchange ratio of 0.8043 Sandy Spring shares for each CommerceFirst share and the cash consideration will be $13.60 per share, in each case subject to possible adjustment. The aggregate merger consideration will consist of approximately 732,000 shares of Sandy Spring common stock and $12.4 million in cash.

    The acquisition prices CMFB at a price to book ratio of 0.61.

    Republic First Bancorp (NASDAQ:FRBK) jumped 31% after it announced that it has completed the sale of $59.0 million of commercial real estate loans and foreclosed properties to a single investor. This transaction will dramatically reduce non-performing asset balances and significantly improve credit quality metrics while still leaving the company with strong capital ratios.

    The loans and foreclosed properties had a book balance of $45.1 million and included $28.4 million of non-accrual loans and other real estate owned. Net proceeds amounted to $30.6 million and the company expects to incur a loss of approximately $14.5 million in the quarter ending December 31, 2011 as a result of the sale. Excluding the completion of the loan transaction, the company was projecting an estimated profit of approximately $1.1 million for the quarter ending December 31, 2011.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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