Seeking Alpha

Merger Arbitrage Mondays - 7 Deals Close, With Few New Ones In Sight

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Includes: ABBV, ABDC, ACIA, AGN, CBLK, CSCO, CTWS, GNW, ILMN, ISCA, LTXB, MKGAF, MLNX, NCI, NVDA, OHAI, OMN, ONCE, PACB, PB, PDRDF, PDYPF, PTMN, RARX, RHHBY, ROX, S, SJW, TMUS, TSG, TYPE, VMW, VSM
by: Asif Suria
Asif Suria
Long/short equity, event-driven, insider ownership, investment advisor
Summary

Merger activity decreased last week.

The acquisition of Ra Pharmaceuticals by UCB.

Mississippi Attorney General Jim Hood to withdraw from the legal challenge over the planned merger of Sprint and T-Mobile.

Merger activity decreased last week, with one new deal announced and seven deals closing.

Deal Statistics:

Total Number of Deals Closed in 2019 151
Total Number of Deals Not Completed in 2019 9
Total Number of Pending Deals
Cash Deals 36
Stock Deals 18
Stock & Cash Deals 10
Special Conditions 6
Total Number of Pending Deals 70
Aggregate Deal Consideration $1.18 trillion

New Deals:

  1. The acquisition of Ra Pharmaceuticals (RARX) by UCB for $2.1 billion, or $48.00 per share in cash.

Deal Updates:

  1. On October 8, 2019, Prosperity Bancshares (PB) announced that it has received all regulatory approvals necessary to complete its previously announced merger with LegacyTexas Financial Group (LTXB). The merger is expected to be effective as of November 1, 2019, subject to the approval of the shareholders of Prosperity and the stockholders of LegacyTexas.
  2. October 8, 2019: International Speedway Corporation (ISCA) has called a special meeting of shareholders on October 16, 2019, for the purpose of voting to approve the merger of Nova Merger Sub and a wholly owned subsidiary NASCAR Holdings with and into the company. The merger is anticipated to close on October 18, 2019, subject to satisfaction or waiver of all closing conditions.
  3. On October 9, 2019, Shareholders of Monotype Imaging Holdings (TYPE) approved the company’s merger with HGGC at a special meeting of shareholders.
  4. On October 9, 2019, Mississippi Attorney General Jim Hood said he will withdraw from the legal challenge over the planned merger of Sprint Corp. (S) and T-Mobile US (TMUS).
  5. On October 10, 2019, OMNOVA Solutions (OMN) announced that its shareholders approved the merger agreement under which Synthomer will acquire all outstanding OMNOVA common shares.

Closed Deals:

  1. The acquisition of Versum Materials (VSM) by Merck KGaA (OTCPK:MKGAF)) on October 7, 2019. It took 178 days for this deal to be completed.
  2. The acquisition of Carbon Black (CBLK) by VMware (VMW) on October 8, 2019. It took 47 days for this deal to be completed.
  3. The acquisition of Castle Brands (ROX) by Pernod Ricard (OTCPK:PDRDF) on October 9, 2019. It took 42 days for this deal to be completed.
  4. The acquisition of Connecticut Water Service (CTWS) by SJW Group (SJW) on October 9, 2019. It took 573 days for this deal to be completed.
  5. The acquisition of DryShips (DRYS) by SPII Holdings on October 11, 2019. It took 53 days for this deal to be completed.
  6. The acquisition of Navigant Consulting (NCI) by Guidehouse on October 11, 2019. It took 70 days for this deal to be completed.
  7. The acquisition of Monotype Imaging Holdings by HGGC on October 11, 2019. It took 77 days for this deal to be completed.

Top 10 deals with largest spreads:

Symbol AnnouncedDate AcquiringCompany ClosingPrice LastPrice ClosingDate Profit AnnualizedProfit
PACB 11/01/2018 Illumina, Inc. (ILMN) $8.00 $5.135 03/31/2020 55.79% 119.79%
S 04/29/2018 T-Mobile US, Inc. (TMUS) $8.16 $6.42 01/31/2020 27.05% 89.76%
GNW 10/23/2016 China Oceanwide Holdings Group Co., Ltd. (N/A) $5.43 $4.35 12/31/2019 24.83% 114.71%
ABDC 08/13/2019 Crescent Capital BDC, Inc. (N/A) $11.02 $8.84 12/31/2019 24.66% 113.94%
ONCE 02/25/2019 Roche Holding AG (OTCQX:RHHBY) $114.50 $99.79 04/30/2020 14.74% 26.90%
MLNX 03/11/2019 Nvidia Corporation (NVDA) $125.00 $110.54 12/31/2019 13.08% 60.44%
OHAI 08/01/2019 Portman Ridge Finance Corporation (PTMN) $1.46 $1.32 12/31/2019 10.61% 49.00%
AGN 06/25/2019 AbbVie Inc. (ABBV) $184.06 $169.09 03/31/2020 8.86% 19.01%
ACIA 07/08/2019 Cisco Systems, Inc. (CSCO) $70.00 $64.735 07/31/2020 8.13% 10.17%
TSG 10/02/2019 Flutter Entertainment PLC (OTC:PDYPF) $21.40 $20.09 09/30/2020 6.54% 6.76%

Disclaimer: I hold long positions in Mellanox Technologies, Pacific Biosciences of California, Celgene (CELG) and Bristol-Myers Squibb (BMY). 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 MLNX, PACB, CELG, BMY. 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.