February 10, 2021 | Technology | Global | Ended
What to Expect from China's SAMR / Dialog, Inphi, Maxim, Siltronic, and Xilinx : In-Depth Report
State-of-the-art computer chips underpin many of today’s strategically important emerging technologies and are vital to the balance of global military power, owing to their use in telecom networks, high-performance computing, Internet of Things (IoT), artificial intelligence (AI) and next-generation weapons platforms. Gaining the technology upper hand requires control over their production, and both China and the US profoundly recognise that semiconductor technology and fabrication is critical to reaching their respective goals of global economic and military superiority. Unfortunately for China, although the semiconductor supply chain is global, its foundation is based largely on US technology, and the world’s leading chipmakers, from Qualcomm to Samsung to TSMC, all rely on the tools and intellectual property of only a handful of mostly American companies. This dependence on foreign technology has created challenges for China, exemplified by the Trump administration’s attempts to cut Huawei’s access to key technologies, subsequently putting the Chinese company into survival mode while hampering Beijing’s strategic ambitions in 5G. For Washington, implementing export controls and placing restrictions on Chinese companies is necessary to protect US economic competitiveness and national security. But this approach comes with risks, including reciprocal actions by China against US businesses. Armed with the ability to block or significantly delay a transaction, China’s State Administration for Market Regulation (SAMR) arguably offers an effective retaliatory tool against US trade aggressions. In this report, we assess this risk against five pending large cap semiconductor deals – Dialog, Inphi, Maxim, Siltronic, and Xilinx. We speak with experts to explain the reasons behind SAMR delays and assess precedents to determine the extent of political influence on China's merger control outcomes. Based on China’s key semiconductor priorities, we identify which deals are the ‘riskiest’ and most prone to a lengthy review at SAMR.
February 09, 2021 | Financials | Europe | Ended
Natixis / Groupe BPCE : New Deal Insights
French financial cooperative BPCE has offered to buy out minority shareholders of its troubled investment banking subsidiary, Natixis, for €4.00 per share (cum dividend). The acquirer is trying to buy the remaining 29.3% that it does not already own through a public tender offer at a 15.5% premium over Natixis’ share price on 5-Feb-21, and a 39.6% premium to the target’s closing price on 11-Jan-21, the day before the market began to speculate of a renewed corporate event. In July 2020, the Financial Times broke a story about BPCE exploring a buyout for its remaining stake, but after BPCE confirmed that it did not intend to file a draft tender offer for Natixis, the acquirer was reportedly subject to a mandatory six-month lock-up, which only expired on 17-Jan-21. We now have a firm offer ... Deal risks assessed in this research report: • Deal termination upon failure to reach the 90% minimum acceptance threshold (due to activist-BPCE game theory)
February 08, 2021 | Technology | Europe | Ended
Dialog Semiconductor / Renesas Electronics : New Deal Insights
Semiconductor consolidation continues unabated in 2021 with the 8-Feb-21 announcement of a definitive offer by Japanese chip manufacturer, Renesas Electronics, for Anglo-German semiconductor company, Dialog Semiconductor. The agreed offer price is €67.50 per share, a headline premium of 20.3% and 28.9% higher than Dialog’s undisturbed share price on 4-Feb-21, the day before rumours of a tie-up hit the headlines. The transaction is structured as a UK scheme of arrangement and, accordingly, requires 75% approval by Dialog’s shareholders at a Court Meeting and EGM; approval by Renesas shareholders is not required ... Deal risks assessed in this research report: • Delays due to antitrust or national security reviews • Antitrust risks from China's SAMR • National security risks from the UK
February 03, 2021 | Health Care | North America | Ended
GW Pharmaceuticals / Jazz Pharmaceuticals : New Deal Insights
Marijuana stocks rallied on 3-Feb-21 after Jazz Pharmaceuticals agreed to a $7.2bn cash and stock acquisition of GW Pharmaceuticals, a drug company known for a cannabis-derived medication for epileptic seizures. Representing a 50% premium to GW’s previous day’s close, Jazz’s offer is for $220.00 per GW ADS through $200 in cash and $20 in Jazz shares ... Deal risks assessed in this research report: • Pushback from Congress on US cannabis policy reforms • Scrutiny of GW / Jazz pipeline overlaps • Hedging leakage from collar
January 11, 2021 | Industrials | Europe | Ended
Signature Aviation / Global Infrastructure Partners : New Deal Insights
The battle to control Signature Aviation heated up on 11-Jan-21 after infrastructure investment fund, Global Infrastructure Partners (“GIP”), offered £3.4bn to buy the British aviation services group, outbidding a buyout consortium of Blackstone and Cascade Investment. Signature’s board agreed to GIP’s offer, which is an all-cash deal at $5.50 per share (405p based on announcement exchange rate), but added that it would consider any further offers from Blackstone and Cascade, as well as from private equity firm Carlyle. This follows weeks of press speculation, starting on 17-Dec-20, when Signature disclosed possible offers while confirming that Blackstone had proposed $5.17 (or 383p) per share. Deal risks assessed in this research report: • The other two private equity suitors walk away • Antitrust concerns stemming from GIP’s airport assets
January 06, 2021 | Health Care | North America | Ended
Change Healthcare / UnitedHealth Group : New Deal Insights
On the heels of Centene’s $2.2bn agreement to acquire Magellan Health (MGLN US), UnitedHealth (“UHG”) has announced a definitive, $8bn all-cash takeover of healthcare software and data analytics firm, Change Healthcare. Announced on 6-Jan-21, UHG’s offer represents a 41.2% one-day premium and requisite conditions include Change shareholder approval and antitrust and other regulatory approvals. Blackstone owns 20% of the target and has agreed to support the deal ... Deal risks assessed in this research report: • Antitrust scrutiny leading to divestitures required • Uncertain market definitions • Questions over UHG’s dominance
January 04, 2021 | Technology | North America | Ended
FLIR Systems / Teledyne Technologies : New Deal Insights
US industrial sensor giant, Teledyne Technologies, has agreed to acquire smaller rival, FLIR, an Oregon-based company that makes thermal imaging and night vision technology. The cash and stock deal values the target at $8.0bn and based on FLIR’s last undisturbed date of 31-Dec-20, shareholders were offered total consideration of $56.14 per share at announcement, representing a one-day premium of 28%. The merger is subject to both FLIR and Teledyne shareholder approvals and applicable antitrust clearances, including HSR approval. Deal risks assessed in this research report: • Timing bottlenecks stemming from China's SAMR or US antitrust • Significant US government contracts could require remedies
December 21, 2020 | Technology | North America | Ended
RealPage / Thoma Bravo : New Deal Insights
Following its successful $3.9bn LBO of UK-based cyber security company, Sophos (SOPH LN), in March 2020, Thoma Bravo is now targeting a much larger buyout, and the largest in its history. RealPage, a Texas-based real estate software company, is being taken private at $88.75 per share, which equates to an enterprise value of $10.2bn. The buyout is the second largest LBO of 2020, behind Advent and Cinven’s €17.2bn acquisition of Thyssenkrupp’s elevator business in February. The offer price represents ... Deal risks assessed in this report: • High pro forma leverage • Undisclosed competition issue with a sponsor holding • Timing on money transmitter approvals
December 12, 2020 | Health Care | North America | Ended
Alexion / AstraZeneca : New Deal Insights
US-based Alexion Pharmaceuticals has agreed to be acquired by UK drug maker, AstraZeneca, is what is the largest pharma deal announced this year and since Allergan / AbbVie in 2019 ($63bn). On 12-Dec-20, the companies confirmed a cash and stock definitive agreement that valued Alexion at $39.4bn, or $175 per share, representing a one-day takeover premium of 44.7%. Through the deal, Alexion shareholders will own 15% of the combined entity while AstraZeneca shareholders will own the remaining 85%. AstraZeneca has sought $17.5bn in bridge financing from a consortium of banks. The size of Alexion makes this a Class 1 transaction for AstraZeneca, meaning that ... Deal risks assessed in this research report: • Acquirer activism after AstraZeneca’s initial share price decline • A recall is issued on one of Alexion’s drugs
December 11, 2020 | Technology | Europe | Ended
Siltronic / GlobalWafers : New Deal Insights
The recently announced merger between German silicon wafer company, Siltronic, and Taiwan-based GlobalWafers, is yet another sign that consolidation in the global semiconductor industry continues unabated. On 9-Dec-20, the two companies agreed to a tie-up whereby GlobalWafers will offer Siltronic shareholders €125 per share in cash through a voluntary public tender offer. Additionally, Siltronic typically pays a regular cash dividend every summer and plans to distribute a dividend of approximately €2 per share prior to the completion of the transaction. Siltronic’s executive and supervisory boards have approved the offer, and the price represents ... Deal risks assessed in this report: 65% minimum acceptance condition is rested and GlobalWafers does not bump; antitrust scrutiny from CFIUS in the US, China's SAMR, and Germany's BMWi.