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  • Today - Thursday, August 21, 2014

  • 11:47 AM
    • Some observers believe Pfizer (PFE -0.4%) will rekindle its bid for AstraZeneca (AZN +3%) by late 2014. The British firm rejected its ₤71B offer in May. Pfizer walked away despite being within 7% of the price AstraZeneca wanted.
    • Under British takeover rules, the negotiations could restart as early as August 26 if AstraZeneca invites Pfizer back to the table. Pfizer cannot initiate discussions until November 26. The rules also allow Pfizer to make a single offer via private phone call to AstraZeneca but this option is rarely used because the process stops if the target says no.
    • It all depends on Ian Read's enthusiasm for a higher bid. This may be unlikely considering what happened in May.
    | 3 Comments
  • 11:29 AM
    • Aviation site RGN states "Wall Street is now buzzing that Verizon might be studying a potential joint venture, acquisition or partnership" with GOGO.
    • Verizon archrival AT&T announced plans in April to offer U.S. in-flight Wi-Fi services "as soon as late 2015;" Gogo tumbled on the news. Meanwhile, RGN has previously stated Gogo rival Row 44 is rumored to be on the block. Verizon exited the in-flight telecom services market after Gogo purchased spectrum in '06.
    • Analyst Tim Farrar: "I think that an interest in Gogo would certainly make sense because life is getting increasingly difficult for standalone connectivity providers ... When you have the big boys coming in from the equipment side, the Panasonic and Honeywell-types of the world, and also the terrestrial connectivity side in terms of AT&T, you’ve got to pick your partners."
    • 30% of Gogo's float was shorted as of July 31.
    | Comment!
  • 8:14 AM
    • Shares of Family Dollar (NYSE:FDO) are lower in early trading after the company confirms reports that is has rejected a $78.50-per-share offer from Dollar General.
    • The company says it has antitrust concerns about the combination.
    • The board has reaffirmed that it supports the company merging with Dollar Tree (NASDAQ:DLTR).
    • Premarket: Dollar Tree -1.8%, Family Dollar -0.5%, Dollar General (NYSE:DG) -1.1%.
    | 1 Comment
  • 4:35 AM
    • Dollar General (NYSE:DG) states that Family Dollar (NYSE:FDO) CEO Howard Levine, ignored multiple requests to pursue a merger even prior to Dollar Tree's (NASDAQ:DLTR) $74.50-a-share offer.
    • Rick Dreiling, CEO of Dollar General claims that Levine shrugged off the requests out of fear he would be forced to step down as CEO.
    • Earlier this week, Family Dollar's board announced that it would review Dollar General's $78.50-a-share offer, but continued to recommend shareholders vote for its $74.50-a-share deal with Dollar Tree.
    | 2 Comments
  • Wednesday, August 20, 2014

  • 5:56 PM
    • Bloomberg reports Allergan (NYSE:AGN) isn't currently in active buyout talks with Salix (NASDAQ:SLXP). Though Allergan approached Salix about a deal in recent months, the talks are currently "dormant," and Allergan is exploring other options to thwart Valeant's hostile bid.
    • SLXP -2.7% AH. Shares rose over 15% yesterday after the WSJ reported Allergan has approached Salix about a potential deal. They fell 2.3% in regular trading today.
    | Comment!
  • 4:43 PM
    • CloudVolumes asserts its software allows companies to "deliver any number of applications and any amount of data to any number of virtual machines within milliseconds or seconds." It offers products for both server and PC virtualization platforms, and also for migrating/delivering apps on cloud-based servers.
    • The synergies with VMware's (VMW, EMC) server and PC virtualization platforms, each of which have been dealing with tough competition, are easy to see. As it is, CloudVolumes' software integrates with VMware's vCloud Automation Center (aims to automate IT service delivery).
    • VMware hasn't disclosed the acquisition price. The company predicts the combination of CloudVolumes and VMware's Horizon (PC/app virtualization) platform will "allow customers to build a real-time application delivery system that enables all applications to be centrally managed, always available and up-to-date, and delivered to virtualized environments for desktop, server or cloud on-demand."
    • Yesterday: VMware shakes up C-suite
    | Comment!
  • 2:33 PM
    • Brazilian paper O Estado de S. Paulo reports Vodafone (VOD -0.8%) is mulling an acquisition of TIM Participacoes (TSU -0.5%), Telecom Italia's (TI -0.1%) Brazilian mobile/wireline unit.
    • The paper states Vodafone, hungry to expand after receiving its Verizon Wireless windfall, would prefer to enter Brazil by taking a majority stake in one of the country's 3 top mobile carriers - giants Telefonica and America Movil control the other two - rather than by participating in an upcoming 4G spectrum auction.
    • TIM is estimated to have 26.9% of the Brazilian market, Telefonica's Vivo 28.7%, and America Movil's Claro 24.9%.
    • TI's own M&A plans could stand in the way of a Vodafone offer: The Italian carrier is reportedly weighing a bid to acquire Brazilian wireline carrier GVT, with the goal of trumping an existing offer from Telefonica and merging GVT with TIM.
    | Comment!
  • 12:56 PM
    • Valeant Pharmaceuticals (VRX) and Bill Ackman filed a countersuit in California yesterday in response to Allergan's (AGN -0.2%) lawsuit alleging the two pursuers breached insider trading laws.
    • In addition to the well-known argument that their agreement is legal, they assert cloak and dagger-type activities by Allergan such as secretly recorded telephone conversations, "highly unusual" investor road shows to Valeant's home country of Canada and "unusual" executive transitions.
    • With the exception of the lawyers involved, everyone else is most assuredly fatigued over the ongoing acrimony surrounding Valeant's hostile bid.
    | 1 Comment
  • 12:18 PM
    • Infineon (OTCPK:IFNNF) is paying $40/share, or $3B, in cash to acquire International Rectifier (NYSE:IRF). The price represents a 51% premium to Tuesday's close, and is well above the ~$2B reported by Bloomberg.
    • Infineon is paying ~$2.4B net of cash for the analog chipmaker. The deal will be financed with a mixture of existing cash and credit facilities, and is expected to close in late 2014 or early 2015.
    • The companies declare IRF's gallium nitride (GaN) power management discrete components and ICs complement Infineon's own GaN offerings, and (echoing arguments made for recent chip deals) that the combined company will benefit from greater R&D scale and manufacturing/operational synergies.
    • IRF is now up 47.4% to $39.16. The company has posted its FQ4 report in tandem with the Infineon announcement.
    | Comment!
  • 11:51 AM
    • Fairchild (FCS +2.5%), Intersil (ISIL +1.3%), Semtech (SMTC +2.6%) and Power Integrations (POWI +3.3%) have all given back a chunk of their early gains. Peer International Rectifier, which also rallied, has been halted.
    • All 5 companies had jumped on a Bloomberg report stating Infineon is nearing a deal to buy a U.S. chipmaker for ~$2B.
    | Comment!
  • 11:49 AM
    • British construction and services company Carillion (OTC:CIOIF) says it is abandoning its pursuit of rival Balfour Beatty (OTC:BAFBF) after the company rejected its latest takeover approach.
    • Carillion made a final bid yesterday, offering to give Balfour Beatty shareholders control of the combined company and pay them a cash dividend in a deal that valued the company at £2.1B, or ~$3.5B.
    | 1 Comment
  • 11:43 AM
    • International Rectifier (IRF +6.1%) was among the companies whose shares jumped in response to a report Infineon is set to buy a U.S. chipmaker for ~$2B.
    | Comment!
  • 10:28 AM
    • Bloomberg reports P-E firm Hellman & Friedman is among the P-E firms to have submitted offers for Shutterfly (SFLY +2.6%).
    • The news service adds Shutterfly may be been valued at ~$2B in a sale, and that Bain has also expressed interest. However, tech/Internet companies have shown little interest.
    • Shares have moved higher in response to Bloomberg's report. Shutterfly's market cap is currently right around $2B.
    • Previous: The Deal reports Shutterfly has received buyout offers
    | Comment!
  • 10:15 AM
    • Bloomberg reports Infineon (OTCPK:IFNNF) "nearing an agreement to acquire a U.S.- based semiconductor company for about $2 billion," and that a deal could be announced as soon as today.
    • No word on whom Infineon is looking to buy. Bloomberg notes it reported last month analog/mixed-signal chipmakers Fairchild (FCS +5.6%), Power Integrations (POWI +11.3%), and Semtech (SMTC +8%) are considered M&A targets, as the chip industry continues to consolidate.
    • Shares of all three companies are up sharply, as are those of peers International Rectifier (IRF +5.8%) and Intersil (ISIL +4.4%). FCS and IRF are currently worth $2B; POWI is worth $1.9B; ISIL is worth $1.8B; and SMTC is worth $1.7B.
    • "[Infineon] would like to build a stronger presence in power management," says Liberum Capital's Janardan Menon. He adds the market has "high barriers to entry and strong growth prospects," a fact that also hasn't been lost on Texas Instruments and other industry players.
    | Comment!
  • 7:47 AM
    • ABB (NYSE:ABB) agrees to sell its Full Service business unit to private equity firm Nordic Capital, in the latest string of divestments of its non-core operations.
    • "With the agreed sale of our Full Service activities we now have found a new home for five businesses in eleven months that have no substantial synergies with the rest of our portfolio, raising about $1B," says CEO Ulrich Spiesshofer.
    • The sale is expected to close in the fourth quarter.
    • ABB -1% premarket
    | Comment!
  • 2:19 AM
    • Bumble Bee Foods has received takeover overtures from Post (NYSE:POST) and Thai Union Frozen Products (OTC:TUFRF) in recent months, and is now planning to launch a sale process this fall.
    • As the largest canned tuna and sardines producer in North America, Bumble Bee is seeking a valuation upward of $1.5B.
    | 1 Comment
  • Tuesday, August 19, 2014

  • 6:29 PM
    • BHP Billiton's (NYSE:BHP) move to spin off a raft of assets it deems non-core - businesses that employ ~25% of the company's current workforce but deliver less than 10% of its profits - creates a new midsize metals player that could become a prime takeover target for rivals.
    • WSJ mentions Glencore (OTCPK:GLCNF, OTCPK:GLNCY) as a potential suitor, and Mick Davis, the former CEO of Xstrata who left the company when it merged with Glencore, is on the lookout for acquisitions for his new investment vehicle.
    • On the other hand, the new BHP entity could suffer from dis-synergies after the spinoff, potentially facing higher costs in borrowing funds and procuring supplies.
    | Comment!
  • 6:18 PM
    • Along with its Q2 results, PetSmart (NASDAQ:PETM) has confirmed reports it will explore strategic alternatives, including a possible sale. JPMorgan has been hired to help out.
    • The company has also announced: it's buying online pet product retailer and content provider Pet360 for $130M up-front + up to $30M in earn-outs. PetSmart notes Pet360 reaches 12M+ "pet parents" per month, and that its assets include several popular pet food and content properties. The deal is expected to close in September.
    • PetSmart has launched "a broad cost-reduction program" that will "target all areas of the business, including, in order of magnitude, cost of goods sold, logistics, sourcing, store operating costs and overhead." More details will be given next quarter.
    • Comparable store sales fell 0.5% Y/Y in Q2. Q3 EPS guidance is at $0.93-$0.97 (consensus is at $0.94), and full-year EPS guidance is at $4.29-$4.39 (consensus is at $4.32).
    • Full-year net sales are expected to grow at a low-single digit clip (consensus is at 2%), and comparable store sales are expected to be relatively flat.
    • Shares are halted. Q2 results, PR.
    | Comment!
  • 4:39 PM
    • Lear (NYSE:LEA) is close to a deal to acquire Eagle Ottawa, the world's largest supplier of premium automotive leather, for more than $800M, with a deal possibly to be announced this week or next, WSJ reports.
    • Eagle Ottawa's leather products are used in BMW, Chrysler, Mercedes-Benz and other vehicles, while Lear manufactures seating for auto makers including Ford and GM.
    | Comment!
  • 4:24 PM
    • Salix Pharmaceuticals (SLXP +15.5%) receives notice of early termination of the waiting period for U.S. antitrust review under the Hart-Scott-Rodino Act of its planned merger with Cosmo Pharmaceuticals. The waiting period was due to expire on August 21, 2014. The removal of the waiting period satisfies a condition of the closing of the transaction.
    | Comment!
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