Even losers win from $5 bln Actavis deal 20 May 2013 Investors loved it when the generic drug firm was the subject of buyout talks. Now they’re just as pleased that Actavis is buying smaller Warner Chilcott instead. The sector is so ripe for consolidation that it’s hard to come up with any combination that investors won’t embrace.
Morrisons’ click with Ocado makes M&A less likely 17 May 2013 The UK supermarket has gone for a joint venture with online Ocado rather than a full-blown bid. It will help Morrisons, a web laggard, catch up with rivals. A short squeeze explains most of the Ocado share surge, but the smaller firm has won surprisingly advantageous terms.
Bigger really is better in generic drug mergers 15 May 2013 Pharmaceutical firm Actavis has spurned interest from rivals Valeant and Mylan. Instead, the $16 billion generics manufacturer is pursuing the much smaller Warner Chilcott. That combination won’t deliver the hefty dose of cost savings that could come from a larger deal.
A fresh bid for Betfair? Don’t bet on it 15 May 2013 The gaming group’s shares are still up smartly, even though buyout talks failed. That partly reflects growing belief in Betfair’s turnaround. But any lingering bid speculation is almost certainly misplaced. Private equity is typically loath to bypass management and go hostile.
Speech-tech firm’s M&A machine could go in reverse 15 May 2013 Nuance went on a 10-year shopping spree, creating a $6 bln company in the process. But margins are falling, the stock hasn’t advanced in five years, and debt is accumulating. Carl Icahn’s recent entrance could signal an end to acquisitions - even the start of a breakup.
Wave of liquidity engulfs Severn Trent water 14 May 2013 For years bid talk has surrounded the UK’s last listed water utilities. Severn Trent is now in play. A bid could top $14 bln with debt, at 35 pct above the group’s regulated value. That would be rich. Regulation may get tighter. But debt is cheap and funds are eager for yield.
Wall Street plays pass the biotech parcel 13 May 2013 Finance firm Royalty Pharma is offering $5.7 bln to buy Elan, which just announced a $1 bln deal to buy a chunk of royalties that Theravance receives from Glaxo. Confused yet? Blame low rates and Big Pharma’s risk aversion for fertilizing M&A bankers’ creative schemes.
Could Silver Lake quietly be rooting for Icahn? 13 May 2013 A half-baked leveraged recap plan is the latest salvo from the uppity billionaire in the Dell fight. If the buyout firm backing company founder Michael Dell is spooked by the swoon in PC sales, it can’t easily bail on its $24 bln bid. But Carl Icahn could bail it out instead.
Dish’s pay-TV pain signals trouble for Sprint bid 9 May 2013 Weak quarterly results show why the company covets the telecom operator. But the poor earnings also show why Sprint shareholders should be skeptical of the $25.5 bln offer. Rival bidder SoftBank, which has just raised synergy estimates, now looks like an even better option.
TPG’s Asian bank triumphs will be hard to repeat 9 May 2013 The buyout firm is selling part of its stake in Indonesia’s BTPN at a valuation many times its 2007 purchase price. Previous investments in Chinese and Korean banks have also been lucrative. But rising protectionism and abundant liquidity mean future home runs will be scarce.
E.ON will struggle to attract a new linchpin 8 May 2013 After years of a declining share price, the German utility’s second largest shareholder has had enough. Statkraft, a Norwegian peer, sold its 4.2 percent stake in E.ON, realising a huge loss. Its willingness to take such pain highlights the bleak prospects for European utilities.
BMC deal shows how activist playbook brings profit 6 May 2013 Elliott Management has pushed another tech firm into a sale - this time BMC for $6.9 bln. The 2 pct headline premium seems tiny. But the stock is up more than 30 pct since Elliott began agitating. Success followed careful target selection and persistence with Plan A - and Plan B.
Welcome to the era of perpetual private equity 3 May 2013 The $1.3 billion sale of Allflex, an animal-ID firm, is just the latest “secondary” deal between two private equity firms. No wonder: private ownership makes sense for many businesses. And this asset class is so big now that alternative owners are not always available.
Salmon mega-deal is hard to swallow at this price 2 May 2013 M&A is reshaping the seafood industry. Fresh from another deal, the world’s largest fish farmer wants to gobble up a second smaller rival. At $1.7 billion, however, Marine Harvest’s hostile bid for Cermaq looks low. The Norwegian predator may need to offer more.
Carphone Warehouse gets better of Best Buy deal 30 Apr 2013 The mobile phone retailer is buying the U.S. consumer chain out of their European joint venture. The $730 mln price looks cheap, and promises a big boost to the UK group’s earnings. With full control of the JV, Carphone Warehouse may also appeal to a wider range of investors.
SoftBank beating all comers in race for Sprint 30 Apr 2013 Dish’s $25.5 bln bid may look better on paper, but it actually falls short of SoftBank’s $20.1 bln proposal. The Dish pitch would pump up Sprint debt to levels so high that they could weaken the combined company - and leave investors holding a pay TV business poised for decline.
Alibaba spots pricey treasure in Weibo’s network 30 Apr 2013 The e-commerce giant has paid a punchy price for an 18 pct stake in the Chinese microblogging phenomenon. A $3 bln valuation is a lot for a business without much in the way of revenue. Alibaba may lure some Weibo users to its stores, but its thinking looks mainly defensive.
Chrysler value spat may offer Fiat silver lining 29 Apr 2013 The Italian automaker and a union trust are $3 bln apart on the value of the 41.5 pct of the Motown manufacturer Fiat doesn’t already own. Yet the outcome – full integration – isn’t in doubt. In the end, an urgent need to raise equity may hasten Fiat’s move from Italy to America.
Pressure builds on Vodafone to make U.S. exit 25 Apr 2013 Verizon has hired advisers to help it buy Vodafone out of the duo’s mobile JV, Reuters says. Vodafone shares rose, although the mooted $100 bln price looks low. Vodafone is staying silent, but with the markets lapping up a string of stories, momentum is building for a deal.
Etihad bets on India in pricey Jet Airways deal 24 Apr 2013 The Abu Dhabi carrier is throwing indebted Jet Airways a $600 mln lifeline for a 24 pct stake and control of its loyalty programme. But the generous 32 pct premium suggests Etihad will expect more than a minority role at the Indian airline.