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March 22, 2022 | Technology | North America | Active


Anaplan / Thoma Bravo : Deal Insights

Private equity firm Thoma Bravo announced on 20-Mar-22 that it has signed a deal to acquire enterprise software company Anaplan for $10.7bn. The buyout values Anaplan at $66 per share, representing a one-day premium of 30.5% and a 46.4% premium to 16-Mar-22, the day prior to the confirmation of the activist stakes. Anaplan’s board supports the acquisition, which is subject to a shareholder vote as well as regulatory approvals under HSR and foreign investment and antitrust laws. The merger agreement contains customary clauses on representations and warranties and a MAC that carves out...

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March 10, 2022 | Industrials | North America | Active


Meritor / Cummins : Deal Insights

Cummins has entered into a $2.6bn definitive agreement to acquire auto component manufacturer Meritor, a leading supplier of drivetrain, mobility, braking, aftermarket and electric powertrain solutions for the commercial vehicle and industrial markets. Under the terms of the all-cash deal, signed on 22-Feb-22, Cummins will pay $36.50 per share, reflecting a 48% premium to Meritor’s undisturbed price. Cummins said it will fund the merger through a combination of cash and debt while committing to maintain its credit rating. A majority of Meritor shareholders will need to vote in favour of the merger, but a Cummins vote is not required. Other conditions to closing include the receipt of applicable regulatory clearances, including under HSR. The merger proxy ...

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March 10, 2022 | Industrials | North America | Active


Tenneco / Apollo Global Management : Deal Insights

Ailing auto parts maker Tenneco has agreed to be bought by private equity firm Apollo for $1.6bn in equity, an implied enterprise value of $7.1bn. The sponsor is offering $20 per share, representing a generous 100.4% one-day premium to Tenneco’s closing price of $9.98 the day prior. Unanimously approved by Tenneco’s board, the buyout requires an affirmative vote by 50% of target shareholders and regulatory approvals in the US, the FCC and, so far, unspecified international regulators. Apollo funds have committed $1.65bn in equity while banks agreed to lend upwards of $6bn in debt; there is no financing condition. Termination and reverse termination fees are $54m and $108m, respectively. On timing, the preliminary proxy is expected to be filed within 20 business days of the announcement ...

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March 08, 2022 | Financials | North America | Active


First Horizon / TD Bank : Deal Insights

Toronto-Dominion Bank (“TD”) is acquiring US regional bank First Horizon in an all-cash $13.4bn deal that will expand its presence in the US. TD is offering $25.00 per First Horizon share, which represents a 37% takeover premium and values the company at 9.8x ‘23E earnings, including synergies, and 2.1x forward tangible book value. In addition, a ticking fee of $0.65 per share will be paid on an annualised basis (2.6%) if the deal does not close prior to 27-Nov-22. This translates to $0.00178 per share, per calendar day commencing on and including 27-Nov-22 and ending on the day prior to the merger closing. The deal requires First Horizon shareholder approval (50%) as well as regulatory clearances from the Federal Reserve, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the Tennessee Department of Financial Institutions (if required), the Canadian Office of Superintendent of Financial Institutions (OSFI), and US HSR. Note there is no acquirer vote. The merger agreement describes an unquantified burdensome condition clause that ...

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March 04, 2022 | Health Care | North America | Active


Healthcare Trust of America / Healthcare Realty Trust : Deal Insights

On 28-Feb-22, Healthcare Trust of America (“HTA”), which owns and operates medical office buildings (“MOB”), entered into a definitive agreement to combine with smaller rival Health Realty Trust (“HR”) via an all-share reverse merger. The merger exchange ratio is 1:1 and HTA shareholders will be entitled to receive a special cash dividend of $4.82 per share on the last business day prior to closing. Based on the previous trading day’s (24-Feb-22) closing and inclusive of the special dividend, HTA shareholders were offered a total implied value of $35.08 per share, representing an 18.2% premium to the stock’s undisturbed price on 24-Feb-22, the day before Wall Street Journal speculation; the current deal value has declined to $32.71 per HTA share, inclusive of one ordinary dividend. After closing, HTA shareholders will own 61% of the pro forma company while HR shareholders will own the remaining 39%. The board of the new company will consist of nine existing directors of HR, three existing directors of HTA, and one will be mutually agreed upon by both boards ...

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February 28, 2022 | Media | North America | Active


Tegna / Standard General : Deal Insights

Virginia-based US television station operator Tegna has agreed to be taken private by New York investment fund Standard General for $24.00 per share, a deal that values Tegna at a $5.4bn equity value and an $8.6bn enterprise value. The offer represents a 15% one-day takeover premium to Tegna’s closing price on 18-Feb-22 and a 39% premium to 14-Sep-21, the day before the media speculated about the potential sale. Tegna’s board supports the transaction and conditions to closing include approval by Tegna shareholders (50%) and US regulatory approvals from the FTC / DoJ and the Federal Communications Commission (FCC). HSR and FCC applications are expected to be made within 10 business days of the M&A announcement (i.e., by 8-Mar-22). The offer consideration also includes scaled ticking fees if consummation takes longer than anticipated. The companies currently expect the deal to close in ...

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February 23, 2022 | Health Care | North America | Ended


Arena Pharmaceuticals / Pfizer : Deal Insights

US drugmaker Pfizer has signed a definitive agreement to acquire all of biopharma company Arena Pharmaceuticals for $6.7bn. The $100 per share all-cash offer represents a 100% premium to Arena’s share price on 10-Dec-21, the last trading day before news of a possible merger hit the headlines. Completion is subject to antitrust clearances in the US and other jurisdictions, including Austria, Germany (notified on 26-Jan-22), and the EC or UK CMA (if a UK referral is requested and accepted). The definitive proxy was filed on 3-Jan-22 and Arena shareholders voted to approve the acquisition on 2-Feb-22. After initially submitting US antitrust notices in early January 2022, the companies pulled (3-Feb-22) and refiled (7-Feb-22) their HSR filing, so the new waiting period will expire on 9-Mar-22. On its 4Q’21 earnings call held on 8-Feb-22, Pfizer reaffirmed this move as “not unusual” and said it was simply a procedural step to allow the FTC an additional 30 days for review. The refile was likely pursued to account for delays at the FTC following the agency’s assertions that its capacity to investigate deals ahead of statutory deadlines has been challenged due to ...

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February 21, 2022 | Consumer Discretionary | Australia | Active


Crown Resorts / Blackstone Group : Deal Insights

On 14-Feb-22, troubled Australian resort and casino operator Crown Resorts announced it has agreed to be taken over by Blackstone in a definitive scheme of arrangement valued at AUD 8.9bn. The firm offer is the culmination of a back-and-forth between Crown, Blackstone and two competing suitors, rival casino operator Star Entertainment (SGR AU) and asset management firm Oaktree Capital, both of which made offers to purchase all or parts of Crown last year. Those proposals were withdrawn following the emergence of allegations that threatened Crown’s ability to hold its Australian gaming licence. Crown has since been subject to investigations by the Australian government into its casino operations in Melbourne and Perth. Last October, a report by the Victoria Royal Commission concluded that the company would be allowed to keep its licence even though the investigation found it to have been involved in illicit activities, including money laundering activities. The latest proposal is structured as an Australian scheme, and despite the company’s legal troubles ...

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February 17, 2022 | Defence | Europe | Active


Ultra Electronics and Meggitt / Revisiting UK National Security Trends : In-Depth Report

On 18-Aug-21, the UK Secretary of State for Business, Energy & Industrial Strategy (BEIS), Kwasi Kwarteng, issued a Public Interest Intervention Notice (PIIN) on the acquisition of UK-based Ultra Electronics by US private equity firm Advent’s Cobham subsidiary. Initiated on national security grounds, the PIIN gave the CMA until 18-Jan-22 to investigate and report back to the Secretary of State. The CMA has delivered its Phase I report to the Secretary of State, and we await Kwarteng’s decision on whether to (i) approve the merger outright, (ii) approve it with undertakings in lieu (UILs) of a CMA Phase II reference, or (iii) refer it for a more in-depth Phase II review. Ultra is one of two multi-billion-pound UK defence deals that has attracted the attention of the UK government, the other being Parker-Hannifin’s proposed acquisition of Meggitt, which received a PIIN on 18-Oct-21, also on national security grounds. The Phase I report for Meggitt / Parker-Hannifin is due to be handed to the SoS by 18-Mar-22. In this report, we speak with CMA and UK national security experts and analyse precedents to hypothesise what UILs could be offered by Parker and Cobham to secure UK government approvals for their respective deals. We believe that both takeovers ...

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January 20, 2022 | Technology | North America | Active


Activision Blizzard / Microsoft : Deal Insights

Microsoft is buying scandal-plagued video game giant Activision Blizzard in an all-cash deal worth $69.7bn. The acquisition will make Microsoft one of the world’s video game developers and will give it control of some of the most popular games on the market, including Call of Duty and World of Warcraft. Under the terms of the agreement, signed on 18-Jan-22, Microsoft will pay $95.00 per share, representing a one-day premium of 45%. The deal requires approval from a majority of Activision shareholders, but no vote from Microsoft shareholders is needed. The merger agreement contains customary clauses on representations, warranties, covenants, a MAC which specifically excludes impact of COVID-19, and statutory right of appraisal under the Delaware ...

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