Back From Vacation: What Happened Since I Left?

The markets never sleep, and while I was away on a (well deserved!) trip, a few things worth mentioning happened in the M&A space

Summer.. always a good time to be checked out of the financial world. But that I’m taking a break doesn’t mean nothing is happening, and before publishing about a new deal hopefully early next week, I want to quickly review what’s happened recently in our little merger arbitrage business now that I’m back from vacation. Continue reading “Back From Vacation: What Happened Since I Left?”

Tesla Buys SolarCity: Bailout Or The Future Of Energy?

On August 1, 2016, Tesla (NASDAQ: TSLA) announced that it had reached a definitive agreement with SolarCity (NASDAQ: SCTY), approved and recommended by the Boards of the two companies. Since the talks between the two companies were made public in June, lots have been said about this unusual situation.

So it’s happening. Elon Musk is buying Elon Musk. Or at least to some extent, since the entrepreneur owns roughly 20% of each company and is CEO of Tesla, Chairman of SolarCity. There has been so much said on this deal over the past couple of months that I will only focus on the points that I think are the most relevant: does it make sense for shareholders, should it go through, and will I put my money in it. The answer to the 2 first questions is yes, the one to the last is no, and here is why.

Continue reading “Tesla Buys SolarCity: Bailout Or The Future Of Energy?”

Mega Deals In The Spotlight

Two deals part of the portfolio, Anthem/Cigna and AbInBev/SABMiller, have been making the headlines in recent weeks. Re-visiting those two opportunities and updating my views.

Two of the 5 pending deals in the portfolio date from before the the existence of this blog. Just seizing the opportunity of the recent press coverage to briefly go over them again as well as provide an update on my strategy.

Continue reading “Mega Deals In The Spotlight”

Microsoft Swallows LinkedIn

On June 13, 2016, Microsoft (NASDAQ: MSFT) announced that it had reached an agreement with LinkedIn (NASDAQ: LNKD) to acquire it for US$26.2 billion

The deal prices Linkedin at US$196/share, or a premium of ~50% to the share price as of June 10, 2016, the last day before the public announcement. Continue reading “Microsoft Swallows LinkedIn”

China Nepstar Going Private Is An Arbitrageur’s Dream

On March. 16, 2016, China Nepstar (NYSE: NPD) announced it had entered into a definitive merger agreement for a going private transaction. The deal requires 66.6% of the shareholder votes to go through, and 79.5% of the shares have already been committed. The vote being the only material step to closing, the merger spread of ~5.3% is a steal.

Less than a week following the first post identifying an arbitrage opportunity in a Chinese going-private transaction, mergerarbitrages.com doubles down and adds China Nepstar Chain Drugstore to the buy list.

Continue reading “China Nepstar Going Private Is An Arbitrageur’s Dream”

Towards A Bayer Monsanto Combination?

Monsanto (NYSE: MON) has received a non-binding proposal from Bayer (ETR: BAYN) regarding a takeover that could be worth US$70 billion including debt

Less than 6 months after the failed takeover attempt of Syngenta (VTX: SYNN) by Monsanto, the German chemical giant Bayer has decided to make a move to bolster its position as a life sciences company. A typical acquisition premium of 30-40% means an offer for Monsanto could yield US$117 – US$125/share (the stock was trading at ~US$90/share before the news that Bayer was on the lookout for an acquisition came out a week ago). Continue reading “Towards A Bayer Monsanto Combination?”

Today In The News: Pfizer Inc. On An Acquisition Roll

Pfizer Inc. (NYSE:PFE) announced today that it will acquire Anacor (NASDAQ:ANAC) for US$5.2bn

After terminating two mega deals in a row (the failed hostile takeover of AstraZeneca (LON:AZN) and the blocked merger with Allergan (NYSE:AGN)), Pfizer Inc. is back at the acquisition table, this time with a less financially ambitious target, Anacor Pharmaceuticals. The main strategic reason for the purchase is crisaborole, a product developed by Anacor that treats eczema. Continue reading “Today In The News: Pfizer Inc. On An Acquisition Roll”