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   Strategies & Market TrendsSpeculating in Takeover Targets


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To: richardred who wrote (2355)10/1/2010 10:15:21 AM
From: richardred
   of 6087
 
NEC Made Higher Bid for Cogent Before 3M Deal
October 1, 2010, 8:05 am

Cogent, the fingerprint-identification systems maker being acquired by 3M, received a more-than $1 billion buyout bid from NEC, according to court papers, Bloomberg News reported.

3M, the maker of products including anti-counterfeiting laminates, agreed Aug. 30 to buy Pasadena, California-based Cogent for $10.50 a share for a total of $943 million. Cogent investors sued in Delaware Chancery Court alleging the company’s officials didn’t get enough for shareholders and unfairly structured the deal to deter other bidders.

NEC, Japan’s largest maker of personal computers, bid as much as $12 a share before Cogent’s board agreed to St. Paul, Minnesota-based 3M’s offer, Cogent shareholders said in a court filing unsealed yesterday. Cogent officials had said they’d received a bid from an unidentified bidder identified only as “Company D.”
dealbook.blogs.nytimes.com

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To: richardred who wrote (2332)10/9/2010 10:18:00 PM
From: richardred
   of 6087
 
Is This the Cheapest Stock Ever?

By Rich Smith | More Articles
October 8, 2010 | Comments (0)

Recently, a poster over on the discussion boards run by our good friends at Yahoo! posed the question: Is AngioDynamics (Nasdaq: ANGO) the "most undervalued medtech stock ever"?

Since the company featured prominently in a Wall Street Journal article earlier this week, the question piqued my interest. And since AngioDynamics reported its fiscal first-quarter earnings last night, now seems as good a time as any to search for an answer.

What is AngioDynamics?
The company mostly manufactures catheters, needles, and similar items for use in heart and vascular surgery. But AngioDynamics also has a potential game-changer in the form of its NanoKnife -- a technology designed to zap cancer tumors with electricity.

The NanoKnife, and controversy over the product's use, dominated Monday's WSJ article. In a nutshell, insurers like Blue Cross cite insufficient "scientific evidence of effectiveness in improving health outcomes" as an excuse for not reimbursing NanoKnife treatments. On the other side of the debate, the device's inventor boasts of its "phenomenal" success rate. In between are the doctors and hospitals, whose opinions range all over the place.

Yet judging from yesterday's report, the consensus may be swinging in the NanoKnife's favor. Since its introduction, only 322 patients have undergone NanoKnife treatment. But 92 of these patients were treated over just the past three months, up from 76 in the previous quarter. That 20% sequential growth is fast enough to lend credence to suggestions that AngioDynamics could be a takeover target for slower growers like Johnson & Johnson (NYSE: JNJ) or Covidien (NYSE: COV).

That's not to say that AngioDynamics looks all that bad on its lonesome. Over the past 12 months, AngioDynamics generated $35.8 million in free cash flow, which gives the stock a FCF multiple around 10.

True, sales growth overall was slow in the most recent quarter, with management blaming the same "procedure volume slowdown" that has had Wall Street analysts warning against the risks of investing in pricey medical-equipment stocks such as Intuitive Surgical (Nasdaq: ISRG) and Zimmer (NYSE: ZMH). Baxter (NYSE: BAX) and Medtronic (NYSE: MDT) are cheaper ways to play the space. But if analysts are right about the longer-term growth trends, AngioDynamics could indeed be a bargain.
fool.com

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From: richardred10/12/2010 11:34:41 AM
   of 6087
 
Deal Profile: Pfizer to Acquire King Pharmaceuticals


By Stephen Grocer

Pfizer agreed to buy pain-drug maker King Pharmaceuticals for $3.6 billion in cash.

The deal comes a year after Pfizer bought Wyeth for $68 billion, a deal which unleashed a run of merger activity in the pharmaceutical industry. Big drug makers face the expiration of patents on many flagship drugs, which opens the doors for much cheaper generic versions of those drugs to enter the market.

Under the agreement, Pfizer will pay $14.25 per share for King, a 40% premium to Monday’s closing price. King’s stock through Monday was down 17% this year as the Bristol, Tenn., company has been struggling to find a replacement for its once-best-selling Altace blood-pressure treatment, whose sales plunged due to generic competition. More recently, the Skelaxin pain killer also became subject to generic competition.
blogs.wsj.com

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From: richardred10/12/2010 11:48:55 AM
   of 6087
 
Avon jumps after takeover report
Oct. 12, 2010, 10:44 a.m. EDT
By William Spain, MarketWatch

CHICAGO (MarketWatch) -- Shares of Avon Products bounced more than 6% early Tuesday after a media report said that the beauty-products behemoth could be a takeover target.

A story in Britain’s Daily Mail said that one bidder for Avon (NYSE:AVP) is L’Oreal, which is preparing a cash offer of more than $44 a share.

The newspaper noted in its market report column that Avon shares have “been in strong demand” and improved further “amid hot gossip that it is attracting the attention of several big industry players.”

Other potential bidders include Procter & Gamble (NYSE:PG) and Unilever, the story said.
marketwatch.com

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To: richardred who wrote (2336)10/13/2010 1:14:38 PM
From: richardred
   of 6087
 
Sold all of Olin today at 21.29. About 18% return

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From: richardred10/14/2010 9:28:34 AM
   of 6087
 
Ahead of the Bell: Buyout rumor lifts Yahoo shares
Buyout rumor lifts Yahoo shares; report says AOL, private equity firms, eyeing bid

NEW YORK (AP) -- Yahoo Inc. shares got a boost ahead of regular trading Thursday on reports of a potential buyout offer from AOL Inc. and a group of private equity firms.

A deal would marry two companies that haven't been able to improve their financial performance amid relentless competition from other online destinations like Google, Facebook and Twitter.

The Wall Street Journal reported on its website after the close of trading Wednesday that AOL, Silver Lake Partners and Blackstone Group LP are exploring a bid. Two or three other firms could also be interested in the deal, the Journal said. The talks have not yet involved Yahoo.

The company resisted a takeover attempt in 2008, when Microsoft Corp. offered to pay as much as $47.5 billion -- well above Yahoo's market value today of less than $25 billion. But shareholders were so upset at the company for balking that then-CEO Jerry Yang decided to step down.

He was replaced by Carol Bartz at the beginning of 2009, but she hasn't been able to get revenue growing again.

News of a potential buyout sent Yahoo shares up $2.43, or 16 percent, to $17.68 in pre-market trading.
finance.yahoo.com

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To: richardred who wrote (1083)10/14/2010 9:41:52 AM
From: richardred
   of 6087
 
Merck/Ariad Pharmaceuticals: Results of Synergistic Collaboration Coming Soon

Ariad Pharmaceuticals (NASDAQ: ARIA) captured Merck’s (NYSE: MRK) attention enough with its cancer drug, ridaforolimus, in July 2007 to forge a partnership to help Ariad through several clinical trials for multiple cancer indications. More recently, preliminary results of the phase III were impressive enough to give Ariad enough leverage to modify the agreement in May to a much more favorable position for Ariad.

The agreement gave Merck an exclusive license to develop, manufacture and commercialize ridaforolimus; and Merck assumed responsibility for ridaforolimus activities, including clinical trials and regulatory filings. In exchange, Ariad received $50 million upfront as well as an additional $19 million to retroactively fund the development of ridaforolimus to the date of the new agreement.

Previously, at the start of the collaboration, Merck had already made a $75 million upfront payment to ARIAD and since then has paid ARIAD $53.5 million in milestone payments for the initiation of Phase 2 and 3 clinical trials of ridaforolimus in addition to paying its 50 percent share of ridaforolimus development, manufacturing and commercialization costs.

In the future, ARIAD will be eligible to receive up to $514 million in regulatory and sales milestones based on the successful development and commercialization of ridaforolimus in multiple indications. This includes $65 million in milestones associated with the potential sarcoma indication, which currently is in Phase 3 clinical development ($25 million for acceptance of the new drug application by the FDA, $25 million for U.S. marketing approval, $10 million for European marketing approval, and $5 million for Japanese marketing approval) and $200 million in milestones based on achievement of significant sales thresholds.

Ridaforolimus is Ariad’s most advanced drug in clinicals. It is being studied in a trial termed SUCCEED. This trial is a randomized, double-blind, placebo-controlled Phase 3 study of oral ridaforolimus in patients with metastatic soft tissue and bone sarcomas who have achieved a favorable response to chemotherapy. This trial will be completed and data compiled in 4Q 2010. Sarcomas are a group of aggressive cancers of connective tissues for which there are limited treatment options.

In 2009, the American Cancer Society estimated that approximately 10,600 new cases of soft-tissue sarcomas were diagnosed in the United States, and more than 3,800 Americans would die of the disease. In addition, approximately 2,600 new cases of bone sarcomas would be diagnosed and nearly 1,500 deaths were estimated. See here for more information.

There has been no new approved therapy in the U.S. for patients with soft tissue or bone sarcomas in more than 20 years. Ridaforolimus has been designated both as a fast-track and orphan drug product by the U.S. Food and Drug Administration (FDA) and as an orphan drug by the European Medicines Agency (EMEA) for the treatment of soft tissue and bone sarcomas. Merck and ARIAD are pursuing this indication as the initial registration path for ridaforolimus. Ridaforolimus is a novel small-molecule inhibitor of the protein mTOR, a "master switch" in cancer cells. Blocking mTOR creates a starvation-like effect in cancer cells by interfering with cell growth, division, metabolism and angiogenesis. Merck’s interest in ridaforolimus is, not doubt, fueled by the fact that this mechanism could potentially be utilized to fight multiple indications of cancer, not only the soft tissue and bone sarcomas.

On May 25th of this year, shortly after the modification of the initial agreement between Ariad and Merck, Ariad announced that the independent Data Monitoring Committee (DMC) of the Phase 3 SUCCEED trial completed the second interim efficacy analysis as specified in the study protocol and recommended that the randomized, placebo-controlled trial of oral ridaforolimus in patients with metastatic sarcomas continue to its final analysis, without modification to the study protocol. Additionally, they noted that no new safety signals were noted and that the final analysis of progression free survival, the primary endpoint, is expected in the second half of 2010. With the FDA’s apparently increased new focus on drug safety, ridaforolimus as an mTOR inhibitor could benefit as pertaining to its safety profile from Wyeth Pharmaceutical’s (NYSE: WYE) TORISEL and Novartis’ (NYSE: NVS) Afinitor. TORISEL and Afinitor are both mTOR inhibitors. Torisel, given by infusion, was approved by the FDA in May of 2007 for advanced kidney cancer. Afinitor, given orally, was approved in March of 2009 specifically as first treatment for patients with kidney cancer after failure of either of the drugs sunitinib or sorafenib. Although this could be a likely first-in-class approval for sarcomas, the kidney cancer indications for TORISEL and Afinitor both give a proven safety and concept track record for this class of drugs.

Merck has deep pockets with its varied pipeline and $45.4 billion dollar 2010 projected revenue. However, it must really see promise in ridaforolimus and its inhibition of mTOR as viable and a likely mechanism to fight cancer in order to invest in the drug’s past, present and future. Ariad has already benefited from the collaboration and may likely continue doing such as the phase II and III preliminary data for ridaforolimus in multiple applications indicate.

Oncology drugs take a tremendous amount of time and money to discover, develop in phase I, II and III trials as well as have the production facilities and marketing to manufacture and promote. This appears to be a win-win scenario for Merck and Ariad Pharmaceuticals. Merck benefits from the novel discovery of another, smaller and perhaps more flexible and creative company’s product. Meanwhile, Ariad Pharmaceuticals benefits from the financial aspects of development, and the experience with the FDA and production facilities of Merck.

With this partnership, the potential could always arise for something more than a partnership between the two companies. At market close on October 13, 2010 the market cap for Ariad Pharmaceuticals at $3.91 per share could be a tempting offer for Merck at $433 million.

As the final phase 3 data is evaluated and a NDA is filed likely during 4Q of this year, more details of the product’s efficacy and safety will become self-evident. Meanwhile, Merck could possibly be the party initiating a surprise change of its own in the relationship between them and Ariad Pharmaceuticals.

Disclosure: Author holds long positions in the above-mentioned stocks
seekingalpha.com

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To: richardred who wrote (2430)10/14/2010 9:59:24 AM
From: richardred
   of 6087
 
EMC Takes a Big-Data Swipe at Oracle, H.P. and I.B.M.
By ASHLEE VANCE
Big data is like the testosterone of business computing right now. It has put technology’s largest players on an aggression bender.

The latest tech giant to flex its big-data muscle is EMC. On Wednesday, the storage specialist introduced the EMC Greenplum Data Computing Appliance. EMC acquired Greenplum in July, giving it some of the top data warehousing software in the market. The company has taken that code and wrapped it in a metal bundle, adding servers, storage units and networking to make a so-called appliance, which is data-center speak for a system that’s meant to perform a single function well.

The product stands out as EMC’s first real foray into selling customers a complete system rather than just storage bits and bobs. (Look under the covers, though, and you’ll find that Dell actually makes the server part of the appliance.)

Data warehousing systems vacuum up information from huge databases and then let companies poke and prod at that information in the hopes of gleaning insights about their business. Typically, these computing products munch away on inventory, sales, shipping, employee and customer data.

EMC’s move follows I.B.M.’s acquisition last month of the data warehouse appliance maker Netezza for $1.7 billion. Oracle too spent most of its recent customer conference talking about its data warehousing appliances made out of hardware it acquired in the purchase of Sun Microsystems.

Hewlett-Packard and Microsoft have built out their data warehousing arsenals in recent years as well through a combination of in-house work and acquisitions. And Teradata remains the independent market leader.

These companies are all racing to make bigger, faster systems that can keep up with the flood of data being produced by people and all types of things with digital heartbeats.

“Before it was just humans entering data, but now the machines are generating their own information,” said Scott Yara, a co-founder of Greenplum and now a vice president at EMC. “There are wireless networks, switches, routers and sensors. The machines are generating 10 times more data than the humans.”

Greenplum specialized in making software capable of running across many computers linked together. This technique allows customers to analyze huge data sets in a reasonable amount of time.

The bigger the data sets, the better for the technology companies because they’re selling more gear and getting closer to their customers by handling prized information.

“I think data will become so synonymous to computing,” Mr. Yhttp://bits.blogs.nytimes.com/2010/10/13/emc-takes-a-big-data-swipe-at-oracle-h-p-and-i-b-m/?partner=yahoofinanceara said.

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From: richardred10/15/2010 12:24:42 PM
   of 6087
 
It's for Real: Seagate Confirms Buyout Talks

By Anders Bylund | More Articles
October 15, 2010 | Comments (0)

Here we go: Hard drive maker Seagate Technology (Nasdaq: STX) has confirmed that it's in buyout talks with an unnamed "interested party."

Both Seagate and chief rival Western Digital (NYSE: WDC) have been looking like buyout bait for a long time, thanks to a combination of solid business and rock-bottom valuations. I have identified both companies as tremendous values, and fellow Fool Brian Pacampara agrees. It's about time somebody takes advantage of Seagate's mispriced, high-quality business.

Private equity firms are masters of sniffing out undervalued assets and flipping them over a couple of years for a sweet profit. With acquisition talk building, you could see public companies get interested as well. Other potential buyers include serial buyout bingers Hewlett-Packard (NYSE: HPQ), Oracle (Nasdaq: ORCL), and IBM (NYSE: IBM), all of whom have a strong interest in data storage and could integrate a cheap and guaranteed supply of disk drives into their industrywide operations. And there's always the outside chance that Cisco Systems (Nasdaq: CSCO) has decided to take an even deeper interest in hardware systems by building a storage presence from the ground up.

However, there are parts of a Seagate acquisition that wouldn't make sense for this list of serial acquirers. IBM exited the hard drive market years ago by selling that operation to Hitachi. Cisco would be better served by a builder of storage systems such as NetApp (Nasdaq: NTAP) rather than Seagate's nuts-and-bolts products. Finally, Bloomberg reports that Seagate (which has been taken private once before) had recent talks with buyout firms, but those fell apart after the company wouldn't meet financial projections the private equity firm expected.

With official word from Seagate's management, this newest deal-making process sits a cut above rumors, but is still less than signing on the dotted line. You can still buy Seagate and benefit from the final buyout premium, if it happens. Conversely, current shareholders skeptical of a complete deal can sell and enjoy the preliminary pop.

How are you playing Seagate's announcement? Share your thoughts in the comments box below.
fool.com

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To: richardred who wrote (2315)10/18/2010 9:36:17 AM
From: richardred
   of 6087
 
Another medical device maker bites the dust.

St Jude to buy AGA Medical for over $1 bln


Mon Oct 18, 2010 7:28am EDT

* At $20.80, deal is 41 pct premium

* AGA Medical went public in October

NEW YORK Oct 18 (Reuters) - St Jude Medical Inc (STJ.N) will buy AGA Medical Holdings Inc (AGAM.O), a maker of devices to treat heart defects and vascular problems, for more than $1 billion in cash and stock, the companies said on Monday.

At $20.80 per share, the deal values AGA Medical shares at a 41 percent premium to Friday's closing price. The companies valued the deal at about $1.3 billion, including the assumption of about $225 million in debt.

AGA Medical went public in October at $14.50 per share. Its major shareholders include those affiliated with private equity firm Welsh, Carson, Anderson & Stowe, and AGA Medical's co-founder Franck Gougeon.

The deal involves an even split between cash and stock. The exchange ratio for the stock component will be determined by the average closing price of St. Jude stock over 10 trading days, ending two days before the close of the exchange offer.

St Jude said it expects the transaction to close by year's end and it does not affect its earnings outlook for 2010. (Reporting by Lewis Krauskopf, editing by Maureen Bavdek)

reuters.com

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