Merger Arbitrage Mondays – January 24, 2011

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January 24, 2011 | Merger Arbitrage | | Author Asif

Merger activity increased last week with five new deals announced and one deal closing.

You can find all the deals listed below in our Merger Arbitrage Tool that automatically updates itself during market hours.

Deal Statistics:

Total Number of Deals Closed in 2011 10
Total Number of Pending Deals
Cash Deals 44
Stock Deals 17
Stock & Cash Deals 9
Special Conditions 1
Total Number of Pending Deals 71

New Deals:

  1. The acquisition of RAE Systems Inc. (RAE) by Vector Capital for $1.75 per share in cash.
  2. The acquisition of Sterling Bancshares Inc. (SBIB) by Comerica Incorporated (CMA). Expected to close by mid-year 2011 for a closing value of $1.027 billion. According to the terms of the deal, each outstanding share of Sterling common stock will be exchanged for 0.2365 shares of Comerica common stock upon closing.
  3. The acquisition of TAM S. A. (TAM) by LAN Airlines S.A. (LFL). Completion of this transaction is expected to take between six to nine months. On the completion of merger TAM shareholders will receive 0.90 shares in LAN for each TAM share they hold.
  4. The acquisition of Danvers Bancorp Inc. (DNBK) by People’s United Financial Inc. (PBCT) for $23 per share in cash.
  5. The acquisition of NovaMed Inc. (NOVA) by Surgery Partners for $13.25 per share in cash.


Closed Deals:

  1. The acquisition of Rock of Ages Corp. (ROAC) by Swenson Granite Co. on January 20, 2011.


Top 10 Deals with largest spreads:

Symbol Announced
Date
Acquiring
Company
Closing
Price
Last
Price
Closing
Date
Profit Annu.
Profit
LTXC 11/18/2010 Verigy Ltd (VRGY) $12.33 $7.92 06/30/2011 55.64% 129.35%
TLCR 06/07/2010 Grifols (GRF.MC) $28.64 $23.88 03/31/2011 19.93% 110.23%
DTG 04/26/2010 Avis (CAR) $54.79 $47.95 03/31/2011 14.27% 78.93%
TAM 01/19/2011 LAN Airlines S.A. (LFL) $26.93 $24.87 09/30/2011 8.28% 12.13%
DNBK 01/20/2011 People's United Financial Inc. (PBCT) $23.00 $21.65 06/30/2011 6.24% 14.50%
SHMR 10/15/2010 Essilor (N/A) $14.50 $13.69 06/30/2011 5.92% 13.76%
MAJC 09/21/2010 Bayside Capital Partners (N/A) $4.50 $4.25 03/31/2011 5.88% 32.53%
NGAS 12/27/2010 Magnum Hunter Resources Corp. (MHR) $0.60 $0.5685 06/30/2011 5.21% 12.11%
PGN 01/10/2011 Duke Energy Corporation (DUK) $47.44 $45.17 12/31/2011 5.03% 5.39%
CNXT 01/10/2011 Standard Microsystems Corp. (SMSC) $2.15 $2.0499 06/30/2011 4.97% 11.55%

List of pending deals:

  Symbol Announced
Date
Acquiring
Company
Deal
Type
Closing
Value
Closing
Price
Last
Price
Volume Closing

Date

Profit Annu.
Profit
+ LTXC 11/18/2010 Verigy Ltd (VRGY) All Stock $422 million $12.33 $7.92 400,476 06/30/2011 55.64% 129.35%
+ TLCR 06/07/2010 Grifols (GRF.MC) Cash Plus Stock $3.4 billion $28.63 $23.88 863,745 03/31/2011 19.90% 110.05%
+ DTG 04/26/2010 Avis (CAR) Cash Plus Stock $1.56 billion $54.79 $47.95 351,087 03/31/2011 14.27% 78.93%
+ TAM 01/19/2011 LAN Airlines S.A. (LFL) All Stock N/A $26.93 $24.87 837,197 09/30/2011 8.28% 12.13%
+ DNBK 01/20/2011 People's United Financial Inc. (PBCT) All Cash $493 million $23.00 $21.65 6,022,993 06/30/2011 6.24% 14.50%
+ SHMR 10/15/2010 Essilor (N/A) All Cash $130 million $14.50 $13.69 17,129 06/30/2011

5.92%

13.76%
+ MAJC 09/21/2010 Bayside Capital Partners (N/A) All Cash $7.8 million $4.50 $4.25 830 03/31/2011 5.88% 32.53%
+ NGAS 12/27/2010 Magnum Hunter Resources Corp. (MHR) All Stock $98 million $0.60 $0.5685 747,472 06/30/2011 5.21% 12.11%
+ PGN 01/10/2011 Duke Energy Corporation (DUK) All Stock $13.7 billion $47.44 $45.17 1,878,558 12/31/2011 5.03% 5.39%
+ CNXT 01/10/2011 Standard Microsystems Corp. (SMSC) Special Conditions $284 million $2.15 $2.0499 1,820,976 06/30/2011 4.97% 11.55%
+ ALY 08/12/2010 Seawell (SEAW.OL) All Stock $890 million $7.88 $7.52 680,905 03/31/2011 4.77% 26.36%
+ HYC 11/17/2010 Verifone Systems (PAY) All Stock $485 million $9.47 $9.05 294,866 09/30/2011 4.63% 6.79%
+ MI 12/17/2010 BMO Financial Group (BMO) All Stock $4.1 billion $7.45 $7.13 10,138,970 07/31/2011 4.53% 8.79%
+ PVG 09/21/2010 Penn Virginia Resource Partners (PVR) All Stock $954 million $26.86 $25.84 134,769 03/31/2011 3.95% 21.87%
+ PNNW 11/12/2010 City of Nashua (N/A) All Cash $138 million $29.00 $27.95 32,900 09/30/2011 3.76% 5.51%
+ AAI 09/27/2010 Southwest Airlines (LUV) Cash Plus Stock $1.4 billion $7.75 $7.48 2,532,507 03/31/2011

3.61%

19.96%
+ ACL 12/15/2010 Novartis (NVS) All Cash $12.9 billion $168.00 $162.84 917,078 06/30/2011 3.17% 7.37%
+ WTNY 12/22/2010 Hancock Holding Company (HBHC) All Stock $1.5 billion $14.05 $13.64 1,003,407 06/30/2011 3.03% 7.04%
+ GAS 12/07/2010 AGL Resources Inc. (AGL) Cash Plus Stock $2.4 billion $51.79 $50.30 324,641 09/30/2011 2.97% 4.35%
+ ADAM 08/30/2010 Ebix Inc. (EBIX) All Stock $66 million $7.29 $7.09 23,609 12/31/2010 2.82% 0.00%
+ VCGH 11/10/2010 Company's chairman of the Board, CEO, President and COO (N/A) All Cash $37 million $2.25 $2.19 15,300 03/31/2011 2.74% 15.15%
+ NOVL 11/22/2010 Attachment Corporation (N/A) All Cash $2.2 billion $6.10 $5.94 3,613,574 03/31/2011 2.69% 14.90%
+ TCM 11/01/2010 Hanmax Investment Limited (N/A) All Cash N/A $4.50 $4.39 1,700 03/31/2011 2.51% 13.86%
+ ROME 10/12/2010 Berkshire Hills Bancorp (BHLB) All Stock $74 million $12.03 $11.74 1,300 03/31/2011 2.46% 13.61%
+ RAE 01/18/2011 Vector Capital (N/A) All Cash N/A $1.75 $1.71 57,604 06/30/2011 2.34% 5.44%
+ WL 11/01/2010 M & T Bank Corporation (MTB) All Stock $351 million $4.46 $4.36 676,719 06/30/2011 2.24% 5.20%
+ LEGC 12/21/2010 Berkshire Hills Bancorp (BHLB) Cash Plus Stock $108 million $13.29 $13.00 15,475 06/30/2011 2.21% 5.14%
+ NAL 08/19/2010 First Niagara Financial Group (FNFG) Cash Plus Stock $1.5 billion $15.22 $14.91 398,897 05/15/2011 2.11% 6.93%
+ CPEX 01/04/2011 FCB I Holdings Inc. (N/A) All Cash N/A $27.25 $26.70 14,364 06/30/2010 2.06% 0.00%
+ MCCC 11/15/2010 Chief Executive Rocco Commisso (N/A) All Cash $600 million $8.75 $8.58 152,932 06/30/2011 1.98% 4.61%
+ BUCY 11/15/2010 Caterpillar Inc (CAT) All Cash $8.6 billion $92.00 $90.42 808,381 06/30/2011 1.75% 4.06%
+ CRXL 10/06/2010 Johnson & Johnson (JNJ) All Cash $2.41 billion $33.57 $33.05 44,754 03/31/2011 1.58% 8.72%
+ Q 04/22/2010 Century Link (CTL) All Stock $10.6 billion $7.02 $6.91 29,573,086 04/21/2011 1.53% 6.40%
+ JAS 12/23/2010 affiliate of Leonard Green & Partners LP (N/A) All Cash $1.6 billion $61.00 $60.28 527,289 06/30/2011 1.19% 2.78%
+ AYE 02/11/2010 FirstEnergy (FE) All Stock $8.5 billion $26.39 $26.10 1,728,841 03/31/2011 1.12% 6.21%
+ ATHR 01/05/2011 QUALCOMM Incorporated (QCOM) All Cash $3.1 billion $45.00 $44.53 4,462,012 06/30/2011 1.06% 2.45%
+ OCNW 09/16/2010 Calix Inc. (CALX) Cash Plus Stock $171 million $8.45 $8.37 43,143 12/31/2010 0.95% 0.00%
+ ID 09/20/2010 Safran (N/A) All Cash $1.1 billion $12.00 $11.89 1,240,430 03/31/2011 0.93% 5.12%
+ BJGP 10/28/2010 Sanofi – aventis (N/A) All Cash $520.6 million $10.00 $9.91 107,506 03/31/2011 0.91% 5.02%
+ ACV 09/27/2010 Unilever PLC (N/A) All Cash $3.7 billion $37.50 $37.17 954,164 03/31/2011 0.89% 4.91%
+ CLFC 12/09/2010 Nara Bancorp Inc. (NARA) All Stock $285.7 million $7.20 $7.14 134,289 09/30/2011 0.88% 1.30%
+ MIGP 12/01/2010 United Fire & Casualty (UFCS) All Cash $191 million $28.25 $28.0101 3,286 03/31/2011 0.86% 4.74%
+ PLA 01/10/2011 Icon Acquisition Holdings, L.P. (N/A) All Cash N/A $6.15 $6.10 784,640 03/31/2011 0.82% 4.53%
+ OPTC 11/11/2010 TKH Group (N/A) All Cash N/A $2.45 $2.4301 5,750 03/31/2011 0.82% 4.53%
+ VOLT 11/29/2010 Mellanox Technologies, Ltd. (MLNX) All Cash $176 million $8.75 $8.68 4,382 03/31/2011 0.81% 4.46%
+ CADE 10/06/2010 Community Bancorp LLC (N/A) All Cash $38 million $2.50 $2.48 10,600 03/31/2011 0.81% 4.46%
+ MFE 08/19/2010 Intel Corporation (INTC) All Cash $7.68 billion $48.00 $47.68 2,019,391 06/30/2011 0.67% 1.56%
+ DLM 11/25/2010 Kohlberg Kravis Roberts & Co (KKR) All Cash $4 billion $19.00 $18.88 4,246,130 03/31/2011 0.64% 3.52%
+ CPII 11/26/2010 Veritas Capital (N/A) All Cash $525 million $19.50 $19.40 186,608 03/31/2011 0.52% 2.85%
+ FMR 10/28/2010 Fairfax Financial Holdings (FRFHF.PK) All Cash $294 million $16.50 $16.42 36,731 03/31/2011 0.49% 2.69%
+ NOVA 01/21/2011 Surgery Partners (N/A) All Cash $214 million $13.25 $13.19 2,397,273 06/30/2011 0.45% 1.06%
+ SBIB 01/18/2011 Comerica Incorporated (CMA) All Stock $1.027 billion $9.34 $9.30 4,629,347 06/30/2011

0.45%

1.04%
+ DDMX 10/01/2010 TransForce Inc. (TFI.TO) All Cash $210 million $25.00 $24.89 23,399 02/15/2011 0.44% 7.33%
+ DNEX 12/13/2010 Thermo Fisher Scientific Inc. (TMO) All Cash $2.1 billion $118.50 $118.03 70,784 03/31/2011 0.40% 2.20%
+ MTXX 12/14/2010 H.I.G. Capital, LLC (N/A) All Cash $75.2 million $8.00 $7.97 326,685 03/31/2011 0.38% 2.08%
+ KG 10/12/2010 Pfizer Inc. (PFE) All Cash $3.6 billion $14.25 $14.20 3,418,677 03/31/2011

0.35%

1.95%
+ LDSH 11/17/2010 Allegheny Technologies (ATI) Cash Plus Stock $778 million $50.56 $50.39 97,516 03/31/2011 0.33% 1.83%
+ APSG 12/20/2010 Raytheon Company (RTN) All Cash N/A $38.00 $37.90 105,829 03/31/2011 0.26% 1.46%
+ EURX 12/01/2010 Axcan Holdings, Inc. (N/A) All Cash $583 million $12.00 $11.97 126,302 06/30/2011 0.25% 0.58%
+ LCRD 12/20/2010 ASSA ABLOY (N/A) All Cash $80 million $6.25 $6.235 229,411 03/31/2011 0.24% 1.33%
+ MATK 12/21/2010 DSM (N/A) All Cash $1,087 million $31.50 $31.45 454,382 06/30/2011 0.16% 0.37%
+ JCG 11/23/2010 private equity firms TPG Capital and Leonard Green & Partners (N/A) All Cash $3 billion $43.50 $43.47 1,773,929 03/31/2011 0.07% 0.38%
+ BEZ 11/29/2010 ABB Ltd (ABB) All Cash $4.2 billion $63.50 $63.50 589,179 03/31/2011 0.00% 0.00%
+ TOD 12/23/2010 Vigor Industrial LLC (N/A) All Cash $130 million $22.27 $22.29 17,605 03/31/2011 -0.09% -0.50%
+ NST 10/18/2010 Northeast Utilities (NU) All Stock $4.17 billion $42.74 $42.79 209,752 09/30/2011 -0.11% -0.15%
+ ATLS 11/09/2010 Chevron Coproation (CVX) All Cash $4.3 billion $43.34 $43.94 959,890 03/31/2011 -1.37% -7.55%
+ CGC 10/01/2010 Gammon Gold (GRS) Cash Plus Stock $288 million $4.58 $4.67 180,957 12/31/2010 -1.99% 30.30%
+ DYN 12/15/2010 Icahn Enterprises LP (IEP) All Cash $665 million $5.50 $5.64 1,595,664 03/31/2011 -2.48% -13.73%
+ GIW 10/25/2010 Community Bank System (CBU) All Cash $101.8 million $9.50 $9.90 18,330 02/15/2011 -4.04% -67.03%
+ SNIC 12/23/2010 Rovi Corporation (ROVI) All Cash $720 million $14.00 $14.7875 1,490,256 03/31/2011 -5.33% -29.45%
+ UAM 12/31/2010 CVS Caremark Corporation (CVS) All Cash $1.25 billion N/A $20.56 382,664 06/30/2010 N/A N/A

Voluntary Disclosure: I have a long position in Danvers Bancorp (DNBK).




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