Icahn’s late start blunts Cigna blocking campaign 7 Aug 2018 The activist makes a good case for rejecting the insurer’s $52 bln Express Scripts deal. Yet his argument - Cigna is paying too much for a target threatened by regulation and Amazon - was evident months ago. And the window for enlisting other arbs to his side has already closed.
Sinclair dumbly punched a gift horse in the mouth 7 Aug 2018 The right-wing broadcaster needlessly endangered its $3.9 bln bid for Tribune Media by selling stations to questionable buyers. That put sympathetically inclined Trump regulators in a bind. The Chicago-based TV group is better off pulling the plug and selling to someone else.
Japan Tobacco coughs up for more frontier smokers 7 Aug 2018 The owner of Camel and Silk Cut is paying $1.5 bln – a hefty eight times revenue - for Bangladesh's second-largest cigarette company. Its latest emerging market splurge adds sales, but risks distracting the $50 bln giant from newer alternatives, where rivals are forging ahead.
What makes Connecticut Water so tantalizing? 6 Aug 2018 SJW is now paying a one-third premium for the staid Nutmeg State utility. It may flush away rival bidder Eversource and stalker California Water. But the investment return will be low. It only makes sense as a way to invest in infrastructure and prepare for a wave of water deals.
Activist puts another bow on a packaging deal 6 Aug 2018 Bemis’ $5.25 bln sale to Australia’s Amcor is at least the third time Starboard Value has helped tie up a deal in the sector. The two companies are natural partners in a consolidating industry. Successful activism doesn’t have to involve starting talks, but ensuring completion.
IWG botched takeover leaves uncertain future 6 Aug 2018 The 2.2 bln pound office provider walked away from suitors having failed to agree a price. Its UK business is struggling with the fallout from Brexit, and the advance of rival WeWork poses a bigger threat. That leaves founder Mark Dixon having to borrow to invest at a risky time.
India’s dated M&A rules let tycoons bet the house 6 Aug 2018 The Shroff family’s chemical group, UPL, is the latest to exploit a statute that lets companies do big overseas acquisitions without shareholder consent. Ring-fencing offshore debt does not protect investors. With Indian buyers at their most active, it's time for a tighter leash.
Campbell is an indigestible meal for all but Kraft 3 Aug 2018 Dan Loeb is pushing for a sale of the $13 bln soup maker. Campbell’s pretzel deal larded it with debt so an LBO won’t work. The $72 bln food giant with a penchant for cost cuts may be solo at the table. But heirs holding 42 pct of shares won’t roll over without a hearty payout.
Heineken beats honourable retreat from China 3 Aug 2018 The Dutch giant is handing its business in the People’s Republic to CR Beer and taking a $3.1 bln stake in the country’s top brewer. Focusing on other countries makes sense. Influencing the future of its brand in the world’s largest beer market, however, will be more challenging.
Icahn dusts off early playbook chapter with Cigna 2 Aug 2018 Company launches bad deal. Stock falls. Activist buys, shorts target, lobbies to unwind deal. Buyer stock goes up, seller plunges. Investor rejoices. Icahn did it with Mylan – and now he can repeat with Cigna’s value-destructive Express Scripts purchase. Plus ça change.
Singapore’s Grab cashes up for a bigger taxi fight 2 Aug 2018 The ride-hailing firm won one battle when it pushed U.S. giant Uber out of Southeast Asia. Much of its latest $1 bln funding round will be spent in Indonesia, where Grab is up against local rival Go-Jek. That country is where the region's tech landgrabs will be won or lost.
Brookfield pays dearly to enter the home 1 Aug 2018 The $16 bln infrastructure investor is making a detour to pick up Canada’s Enercare. A renter of residential water heaters and air-conditioning systems sits oddly inside an owner of utilities, roads and railways. Its steady growth is valuable, but a 53 pct premium is extravagant.
Chinese mega-merger should catalyze chemical M&A 1 Aug 2018 A changing of the guard at ChemChina suggests a Sinochem deal is getting closer. At more than $100 bln in annual revenue, the resulting giant would be on par with DowDuPont. Some forced sales may result, but Beijing's ambition will keep the focus squarely on more buying.
Activists finagle deal in toppy real-estate market 31 Jul 2018 Brookfield is buying Forest City, owner of a hodge-podge of assets including the New York Times building, for $11.4 bln. The 27 pct premium allows Starboard to exit with a profit. Rising rates and other heady markers mean the deal may signal a peak in property values, too.
Franco-Dutch utility deal muddies U.S. M&A waters 31 Jul 2018 Suez is selling a fifth of its stateside unit to pension manager PGGM for 30 times earnings. The $601 mln transaction looks even pricier than the takeover battles for two other U.S. water utilities. With asset scarcity making the market frothy, buyers risk ending up high and dry.
Rite Aid’s itch should be easy to scratch 30 Jul 2018 Hedge fund Highfields objects to Cerberus-owned Albertsons’ merger with the $2 bln drugstore chain. Minor conflicts at board level don’t help. But plenty of value is being offered to Rite Aid investors. Albertsons doesn’t need to offer much more to make a deal look reasonable.
Vivendi disposals give Bolloré scary M&A war chest 30 Jul 2018 Vincent Bolloré’s acquisitive media group raised $2.7 bln from disposing of stakes in Ubisoft and Fnac Darty, and could borrow more. Possible targets are video games and live music. Yet given a dicey Italian foray and stretched valuations, investors may prefer cash to more M&A.
Yum China deserves more than a cheap takeout 27 Jul 2018 Hillhouse is reportedly in talks to buy the KFC operator. It looks opportunistic given Yum’s knockdown valuation. If successful, the Beijing investment outfit gets a China consumption play with Western-style governance, and its tech savvy could supersize the $14 bln company.
UNFI mixes organic food and financial steroids 26 Jul 2018 The natural-food distributor is paying $2.9 billion for grocery wholesaler Supervalu – a clear attempt to bulk up in response to Amazon’s foray into food retail. UNFI is getting a good deal thanks to generous cost cuts, but the amount of debt it is taking on makes this risky.
Indian tycoon winner of Trump-China metals scrap 26 Jul 2018 Hindalco is snagging aluminium producer Aleris for $2.6 bln after CFIUS concerns torpedoed a previous bid from a Chinese buyer. Hindalco’s U.S. arm Novelis is paying more, but the numbers stack up. Mogul Kumar Mangalam Birla is smartly taking advantage of the trade war for now.