Seeking Alpha

Merger Arbitrage Mondays - April 8, 2019

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Includes: APU, ARRS, BHLB, BLMT, COMM, CTWS, CZFC, ENTG, GG, GNW, GPIC, IMDZ, INUV, LHX, LKSD, LLL, MLNX, MRK, NEM, ONCE, PACB, PBCT, PGLC, RHHBY, S, SIFI, SJW, STC, TISA, UGI, USAS, VSM, WCG
by: Asif Suria
Summary

Merger activity decreased last week.

The acquisition of AmeriGas Partners by UGI Corporation.

SJW Group and Connecticut Water Service jointly filed a new application with the Connecticut Public Utilities Regulatory Authority (“PURA”) for approval of the merger.

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

Deal Statistics

Total Number of Deals Closed in 2019 63
Total Number of Deals Not Completed in 2019 2
Total Number of Pending Deals
Cash Deals 29
Stock Deals 14
Stock & Cash Deals 12
Special Conditions 4
Total Number of Pending Deals 59
Total Deal Size $778.65 billion

New Deals

  1. The acquisition of AmeriGas Partners (NYSE:APU) by UGI Corporation (NYSE:UGI) for $6.66 billion in a cash plus stock deal. Under the terms of the agreement, AmeriGas unitholders will receive 0.50 shares of UGI common stock plus $7.63 in cash consideration for each common unit of AmeriGas.

Deal Updates

  1. On April 2, 2019, SI Financial Group (NASDAQ:SIFI) announced that the stockholders of the company approved the previously announced merger of the Company with and into Berkshire Hills Bancorp (NYSE:BHLB).
  2. On April 3, 2019, Roche (OTCQX:RHHBY) and Spark Therapeutics (NASDAQ:ONCE) announced that Roche has withdrawn its Premerger Notification and Report Form under the Hart-Scott-Rodino Act in connection with Roche's pending acquisition of Spark. As a result of the withdrawal and refiling of the Premerger Notification and Report Form, Roche is extending the offering period of its previously announced tender offer to purchase all of the outstanding shares of common stock of Spark. The offer is being extended until May 2, 2019.
  3. On April 3, 2019, SJW Group (NYSE:SJW) and Connecticut Water Service (NASDAQ:CTWS) announced that they have jointly filed a new application with the Connecticut Public Utilities Regulatory Authority ("PURA") for approval of the merger of SJW Group and Connecticut Water.
  4. On April 4, 2019, Top Image Systems (NASDAQ:TISA) announced that the shareholders of the company voted overwhelmingly to approve the previously announced acquisition by Kofax. Top Image Systems expects the merger to close during the second week of May.
  5. On April 4, 2019, Goldcorp (NYSE:GG) announced that its shareholders voted overwhelmingly in favour of the plan of arrangement to combine with Newmont Mining Corporation (NYSE:NEM).
  6. On April 4, 2019, Harris Corporation (HRS) and L3 Technologies (NYSE:LLL) announced that their stockholders voted to approve all stockholder proposals necessary to complete the merger of equals transaction to create L3 Harris Technologies, Inc. The merger is expected to close in mid-calendar year 2019.

Closed Deals

  1. The acquisition of BSB Bancorp (NASDAQ:BLMT) by People's United Financial (NASDAQ:PBCT) on April 1, 2019. It took 125 days for this deal to be completed.
  2. The acquisition of Immune Design (NASDAQ:IMDZ) by Merck (NYSE:MRK) on April 2, 2019. It took 40 days for this deal to be completed.
  3. The acquisition of Pershing Gold Corporation (NASDAQ:PGLC) by Americas Silver Corporation (NYSEMKT:USAS) on April 3, 2019. It took 185 days for this deal to be completed.
  4. The acquisition of ARRIS International (NASDAQ:ARRS) by CommScope (NASDAQ:COMM) on April 4, 2019. It took 147 days for this deal to be completed.
  5. The acquisition of Versum Materials (NYSE:VSM) by Entegris (NASDAQ:ENTG) on April 4, 2019. It took 66 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 $1.27 06/30/2019 74.80% 328.95%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4 04/30/2019 35.75% 593.13%
S 04/29/2018 T-Mobile US, Inc. (NASDAQ:TMUS) $7.22 $5.63 06/30/2019 28.15% 123.81%
STC 03/19/2018 Fidelity National Financial, Inc. (NYSE:FNF) $49.47 $43.63 06/30/2019 13.39% 58.89%
LKSD 10/31/2018 Quad/Graphics, Inc. (NYSE:QUAD) $7.80 $6.93 06/30/2019 12.55% 55.21%
PACB 11/01/2018 Illumina, Inc. (NASDAQ:ILMN) $8.00 $7.26 06/30/2019 10.19% 44.82%
WCG 03/27/2019 Centene Corporation (NYSE:CNC) $308.74 $283.22 06/30/2020 9.01% 7.32%
CZFC 02/21/2019 German American Bancorp, Inc. (NASDAQ:GABC) $25.69 $23.95 09/30/2019 7.25% 15.13%
MLNX 03/11/2019 NVIDIA Corporation (NASDAQ:NVDA) $125.00 $118.89 12/31/2019 5.14% 7.03%
GPIC 11/27/2018 Angel Holdings Godo Kaisha (N/A) $13.75 $13.19 06/30/2019 4.25% 18.67%

Disclosure: I am/we are long CELG, BMY, 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.

Additional disclosure: Disclaimer: I hold long positions in Celgene (CELG), Bristol-Myers Squibb (BMY) and Finisar (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.