Latest Reports

September 20, 2023 | Industrials | Europe | Active

WestRock / Smurfitt Kappa : Deal Insight

Irish paper and packaging company, Smurfit Kappa (“Smurfit”) announced on 12-Sep-23 that it will acquire US rival WestRock as it aims to become a global leader in sustainable packaging. WestRock shareholders will receive one share in the new entity, known as ‘Smurfit WestRock’, plus $5.00 in cash for each WestRock share, valuing it at $43.51 per share based on the previous day’s closing price (11-Sep-23) and implying a 36.5% takeover premium over WestRock’s undisturbed price on 6-Sep-23, before merger talks were publicly disclosed. The merger, which will result in 49.6% and 50.4% ownership by WestRock and Smurfit shareholders, respectively, is unanimously supported by both boards. Smurfit and WestRock will publish a shareholder circular and a prospectus, respectively, as the deal requires approvals from shareholders of both merger parties at meetings expected to be held in 1H’24. The notable thresholds are 75% of shares in attendance at a Smurfit Court Meeting and EGM, and 50% of shares at a WestRock shareholder meeting. Additionally, antitrust approvals are needed from EU and US regulators, with an HSR filing due by 2-Oct-23. A burdensome clause prevents the divestment of businesses that generated more than $750m in FY’22 revenues, and there are other customary clauses covering representations, warranties, covenants, a MAC that includes carve-outs for pandemics and wars, and non-solicitation clauses with fiduciary-outs. Both companies will continue distributing dividends through completion; we expect WestRock to pay ...


September 18, 2023 | Health Care | North America | Ended

Abcam / Danaher : Deal Insight

Healthcare technology conglomerate Danaher announced on 28-Aug-23 an agreement to buy Abcam, a UK-incorporated global supplier of protein research tools to life scientists, for $5.7bn, including debt. Danaher is offering $24.00 per Abcam share, which represents a 2.7% one-day takeover premium and a 42.7% premium to Abcam’s share price on 9-Jun-23, the last trading day before the target’s founder issued an open letter calling for actions to address financial underperformance and value destruction at the company. The now-definitive deal has received unanimous approval from the boards of both companies and is structured as a court-sanctioned scheme of arrangement under UK law. As such, approval by Abcam shareholders is required (75% in value at the Court Meeting, 75% of votes at the EGM), but Danaher shareholder approval is not needed. Antitrust clearances will be sought from the US, Germany, Austria and China. Filings for the first three are expected within 15 business days (by 19-Sep-23), while the SAMR filing will be made ...


August 25, 2023 | Technology | Asia | Ended

Itochu Techno-Solutions / Itochu : Deal Insight

On 2-Aug-23, Japanese conglomerate Itochu announced its intention to launch a recommended tender offer for its Tokyo-based subsidiary, Itochu Techno-Solutions (“CTC” is the operating company, for ‘Challenging Tomorrow’s Changes’), that specialises in software development and information processing. Itochu owns a 61.24% stake in CTC and will offer JPY 4,325 per share to acquire the 89,625,766 shares that it doesn’t already own (equivalent to a 38.76% stake), worth JPY 387bn (USD 2.7bn). The offer represents an 18.7% premium to CTC’s undisturbed share price on 1-Aug-23. The primary hurdle is a two-thirds minimum acceptance condition, but Itochu nearly owns this and only needs to secure an additional 5.43% of CTC, or 12,550,000 shares. The acceptance threshold was established so Itochu can conduct a two-step acquisition which requires a special resolution at the shareholder meeting. The tender offer, supported and recommended by CTC’s board, will be open for ...


August 24, 2023 | Energy | North America | Ended

Crestwood / Energy Transfer : Deal Insights

Texas energy company Energy Transfer announced on 16-Aug-23 that it will buy its smaller master limited partnership (“MLP”) rival, Crestwood Equity Partners (“Crestwood”), in an all-stock transaction valued at $7.1bn, including the assumption of $3.3bn of debt. According to the agreement, common unitholders of Houston-based Crestwood will receive 2.07 Energy Transfer common units for each Crestwood unit. As a result, Crestwood unitholders will own 6.5% of Energy Transfer, while Energy Transfer unitholders will own the remaining 93.5%. Based on the previous day’s closing prices, the offer implies a negative premium of ...


August 22, 2023 | Consumer Discretionary | North America | Active

Capri / Tapestry : Deal Insights

The parent company of Coach and Kate Spade, Tapestry, is seeking to acquire Capri Holdings, the owner of designer brands Versace and Jimmy Choo. The $57.00 per share offer price values Capri’s equity at $6.7bn and offers target shareholders a one-day 64.7% takeover premium. The anticipated closing of the transaction is set for 2024, with a long-stop date of 10-Aug-24, which can be extended twice, each time for a period of three months. Capri’s board has approved the offer and intends to recommend it to the company’s shareholders. While Capri shareholder approval (50%) is required, no vote from Tapestry shareholders is necessary. The preliminary proxy filing is expected within 20 business days, by 7-Sep-23, and the shareholder meeting will be held within 40 days following the mailing of the definitive proxy. Regulatory conditions to closing include HSR clearance, with a notification anticipated within 15 business days, by 30-Aug-23. Though the merger agreement does not explicitly mention ...


August 08, 2023 | Health Care | North America | Ended

Reata Pharmaceuticals / Biogen : Deal Insightss

Biotechnology company Biogen announced on 28-Jul-23 that it intends to buy Texas-based rare disease specialist Reata Pharmaceuticals for $172.50 per share in cash, implying a 58.9% premium to the previous day’s closing price. Both boards support the deal, which is expected to close in 4Q’23, against a long-stop date of 28-Jan-24. Conditions to closing include HSR clearance and approval by Reata shareholders; Biogen shareholder approval is not required. The preliminary merger proxy is expected within ten business days (by 11-Aug-23), and the target shareholder meeting will be held within 30 days from the initial mailing of the definitive proxy. The deal is not subject to financing, and despite $7.3bn of cash on its balance sheet, Biogen said it will fund the acquisition through cash and new debt, through a senior unsecured bridge loan for $1.5bn from JPMorgan. The merger agreement contains customary clauses on representations, warranties, and covenants, with MAC carve-outs for pandemic and war. A burdensome condition makes specific reference to Reata’s Skyclarys (omaveloxolone) drug, which is ...


July 20, 2023 | Health Care | North America | Ended

NuVasive / Globus Medical : Deal Insights

We are picking up coverage of Globus Medical's definitive and pending all-stock acquisition of its medical device rival, NuVasive, announced on 9-Feb-23. The merger exchange ratio is 0.75 Globus shares for each NuVasive share and, at announcement, this valued the target at $57.52 per share. Since then, Globus shares have declined by -20.3%, bringing the current value to $46.01 per NuVasive share. Shareholder votes were secured at respective shareholder meetings on 27-Apr-23, and the main catalyst and the only pending condition to closing is HSR clearance. HSR was filed on 3-Mar-23, was pulled-and-refiled on 3-Apr-23, and on 3-May-23, the FTC issued a second request. This caused the gross risk arbitrage spread to widen from ...


July 11, 2023 | Industrials | Asia | Ended

NWS Holdings / CTFE : Deal Insights

On 26-Jun-23, Chow Tai Fook Enterprises (“CTFE”) announced its plan to acquire NWS Holdings (“NWS”) for nearly HKD 35.5bn, or HKD 9.15 per share. The offer consideration represents a 14.5% premium over NWS’ share price prior to a pre-announcement trading halt and a 22.2% premium over its undisturbed, previous day’s closing. Since NWS is incorporated in Bermuda and listed in Hong Kong, both the Bermuda Companies Act and the Hong Kong Takeover Code are applicable; the takeover offer is not extended to NWS’ sponsored ADS’ (illiquid securities which trade under NWSGY US). Target shareholders will additionally receive NWS’ final dividend for its fiscal year ending 30-Jun-23 (estimated at HKD 0.31 per share per Bloomberg, with a record date in late November 2023). However, CTFE reserves the right to downwardly adjust the consideration by any other distribution. NWS has established an independent board committee to make a recommendation to its shareholders and has appointed Quam Capital as ...


June 29, 2023 | Technology | Asia | Active

JSR / JIC : Deal Insights

Government-backed Japan Investment Corp. (“JIC”) has reached an agreement to acquire Tokyo-based semiconductor equipment maker JSR for JPY 4,350 per share, representing a one-day premium of 34.5%. News of JIC’s approach was initially reported in Nikkei on 24-Jun-23 and was subsequently confirmed by JSR. After a board meeting on 26-Jun-23 and after having received valuation reports from Mizuho Securities and Mitsubishi UFJ Morgan Stanley Securities, JSR’s board unanimously decided to support the offer and intends to recommend shareholders to tender their shares. The transaction will be structured as a tender offer and the companies expect to launch the offer in late December 2023, with a duration of 20 business days, as mandated by statutory minimum requirements. Activist fund ValueAct Capital ...


June 27, 2023 | Health Care | Europe | Ended

Dechra / EQT, ADIA : Exploring CMA Jurisdiction

In our previous analysis, we highlighted the voluntary nature of the CMA’s merger control regime that allows deals to close without formal notification, even if certain thresholds are met. Most companies notify anyway, however, because it’s a question of legal and commercial certainty. But if a company closes a deal prior to approval, that’s perfectly legal. However, the CMA retains the authority to “call in” deals that raise competition concerns. In the case of Dechra, the absence of a UK merger control condition in the Rule 2.7 announcement suggests that the acquisition does ...



Reset filters