Merger Arbitrage Mondays - February 18, 2019

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Includes: AHL, AMCRY, APO, ATHN, BEL, BMS, BMY, BNCL, CASM, CELG, ECA, EHIC, ELLI, ESV, EW, FNF, GNW, GPIC, ILMN, INUV, LKSD, LLY, LOXO, LVMHF, MB, NFX, ORM, PAAS, PACB, QUAD, RC, RDC, S, STC, TAHO, TMUS, WSFS
by: Asif Suria
Summary

Merger activity decreased last week with two new deals announced.

The acquisition of Ellie Mae by Thoma Bravo for $3.7 billion.

Amcor Limited secured EU antitrust approval for its acquisition of Bemis.

Merger activity decreased last week with two new deals announced and five pending deals closing.

Deal Statistics:

Total Number of Deals Closed in 2019 34
Total Number of Deals Not Completed in 2019 1
Total Number of Pending Deals
Cash Deals 29
Stock Deals 21
Stock & Cash Deals 15
Special Conditions 5
Total Number of Pending Deals 70
Total Deal Size $678.96 billion

New Deals:

  1. The acquisition of Ellie Mae (NYSE:ELLI) by Thoma Bravo for $3.7 billion or $99.00 per share in cash.
  2. The acquisition of CAS Medical Systems (NASDAQ:CASM) by Edwards Lifesciences Corporation (NYSE:EW) for $100 million or $2.45 per share in cash.

Deal Updates:

  1. On February 11, 2019, Amcor Limited (AMC.AX) (OTCPK:AMCRY) secured EU antitrust approval for its acquisition of Bemis (NYSE:BMS).
  2. February 12, 2019: According to Reuters, a group of eight Democratic U.S. senators and independent Senator Bernie Sanders urged the Justice Department and Federal Communications Commission on to reject the proposed merger of T-Mobile US (NASDAQ:TMUS) and Sprint (NYSE:S).
  3. On February 13, 2019, WSFS Financial Corporation (NASDAQ:WSFS) announced that its primary subsidiary, WSFS Bank, received approval from the Office of the Comptroller of the Currency to merge Beneficial Bank, the primary subsidiary of Beneficial Bancorp (NASDAQ:BNCL), into WSFS Bank.
  4. On February 14, 2019, Belmond (NYSE:BEL) stockholders voted to adopt the Agreement and Plan of Merger with LVMH-Moët Hennessy Louis Vuitton (OTCPK:LVMHF).
  5. On February 15, 2019, Tahoe Resources (NYSE:TAHO) announced that the Mexican Federal Economic Competition Commission approved the proposed transaction whereby Pan American Silver Corp. (NASDAQ:PAAS) will acquire all of the issued and outstanding shares of Tahoe. The arrangement is anticipated to be completed on or about February 22, 2019.
  6. On February 15, 2019, Ready Capital Corporation (NYSE:RC) announced that it has set March 21, 2019, as the record date for the special meeting of its stockholders to consider and vote on a proposal to approve the previously announced definitive merger agreement with Owens Realty Mortgage (NYSEMKT:ORM).
  7. On February 15, 2019, Rowan Companies (NYSE:RDC) announced that it has received clearance from the United Kingdom's Competition and Markets Authority for its pending combination with Ensco (NYSE:ESV).

Closed Deals:

  1. The acquisition of athenahealth (NASDAQ:ATHN) by an affiliate of Veritas and Evergreen on February 11, 2019. It took 91 days for this deal to be completed.
  2. The acquisition of Newfield Exploration Company (NYSE:NFX) by Encana Corporation (NYSE:ECA) on February 13, 2019. It took 104 days for this deal to be completed.
  3. The acquisition of Loxo Oncology (NASDAQ:LOXO) by Eli Lilly and Company (NYSE:LLY) on February 15, 2019. It took 39 days for this deal to be completed.
  4. The acquisition of Aspen Insurance Holdings Limited (NYSE:AHL) by Apollo Global Management (NYSE:APO) on February 15, 2019. It took 171 days for this deal to be completed.
  5. The acquisition of Mindbody (NASDAQ:MB) by Vista Equity Partners on February 15, 2019. It took 53 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol Announced Date Acquiring Company Closing Price Last Price Closing Date Profit Annualized Profit
INUV 11/05/2018 ConversionPoint Technologies, Inc. (N/A) $2.22 $1.24 03/31/2019 79.03% 703.58%
EHIC 04/06/2018 Teamsport Parent Limited (N/A) $13.50 $10.56 03/31/2019 27.84% 247.85%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.55 03/15/2019 19.34% 282.37%
S 04/29/2018 T-Mobile US, Inc. (TMUS) $7.39 $6.3 06/30/2019 17.29% 47.82%
PACB 11/01/2018 Illumina, Inc. (NASDAQ:ILMN) $8.00 $7.13 06/30/2019 12.20% 33.74%
CELG 01/03/2019 Bristol-Myers Squibb Company (NYSE:BMY) $101.67 $90.69 09/30/2019 12.11% 19.73%
STC 03/19/2018 Fidelity National Financial, Inc. (NYSE:FNF) $47.33 $42.72 06/30/2019 10.80% 29.86%
TAHO 11/14/2018 Pan American Silver Corp. (PAAS) $4.10 $3.73 02/26/2019 9.92% 452.58%
LKSD 10/31/2018 Quad/Graphics, Inc. (NYSE:QUAD) $9.09 $8.3 06/30/2019 9.49% 26.24%
GPIC 11/27/2018 Angel Holdings Godo Kaisha (N/A) $13.75 $12.94 06/30/2019 6.26% 17.31%

Disclaimer: I hold a long position in Finisar (NASDAQ:FNSR). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

Disclosure: I am/we are long FNSR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.