| To: richardred who wrote (3527) | 11/21/2013 9:28:46 AM | | From: richardred | | | | Yahoo!: Can’t Rule Out Large Acquisitions, Says SunTrust
Shares of Yahoo! ( YHOO) are up $1.40, or 4%, at $36.03, continuing an after-hours run-up on the announcement the company extended its buyback allocation by $5 billion, and will issue $1 billion in convertible notes due 2018.
As I noted last night, Citigroup’s Mark May observed the move was not a surprise, and there others who also see this as a sensible move, including SunTrust Robinson Humphrey’s Rob Peck, who has a Neutral rating on the stock.
This morning Peck writes that it is “a prudent move by management, as the company works to turn around its core and return to revenue growth.”
Peck “would not rule out a large acquisition by Yahoo! as it seeks to balance its long term goals and near term excess balance sheet.”
“Companies such as Pinterest, Snapchat, Buzzfeed, and Business Insider as well as video ad-tech stack companies are frequently speculated as candidates.”
He’s still cautious about investing the stock, however, without further traction in the traditional ad business, even though he sees rising value, and rising payouts, in the prospective IPO of Alibaba Group Holding, the Chinese e-commerce firm in which Yahoo! maintains a minority investment:
blogs.barrons.com |
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| To: richardred who wrote (3537) | 11/22/2013 9:41:30 AM | | From: richardred | | | | Brace yourself for a mobile acquisition feeding frenzy
Image credit: Pixel Embargo/Shutterstock
November 20, 2013 7:30 AM
Jack Gold
Jack Gold is the founder and principal analyst at J.Gold Associates.
Consolidation will dominate a rapidly maturing mobile market over the next couple of years. Both IBM and Oracle made moves this past week. This is just the tip of the iceberg! If your enterprise is using mobile technology from a small vendor, expect big changes.
Last week, IBM announced its acquiring FiberLink MaaS360 — a company that provides a cloud-based Mobile as a Service management and security capability to some significant enterprise customers. It’s rumored that IBM paid as much as $300M for this company, although the actual amount has not been disclosed.
A couple of days later, Oracle announced it’s acquiring Bitzer Mobile, a mobile management and security company concentrating on the enterprise market. Coincidence? Not at all. The maturing of the mobile market means the major players all need to accumulate “critical mass”, or risk jeopardizing their hold on an enterprise’s infrastructure.
Over the past 18 months IBM has been buying up mobile oriented companies: Worklight (mobile app platform), UrbanCode (app development), and Trusteer (fraud detection/security). This is being done to supplement its own products (e.g., Endpoint Manager, Security Access Manager, Connection Manager), and its major infrastructure platform, WebSphere. IBM’s “bulking up” of its MobileFirst initiative through this acquisition spree and its own home-grown products have elevated it on the list of credible enterprise mobile infrastructure providers, although much integration work still needs to be done to make MobileFirst a seamless offering.
For its part, Oracle has been well behind the technology curve when it comes to mobility. Although it has puttered around the edges for years, it has lacked a credible mobile strategy, falling far behind its rivals, particularly SAP, who has gone through its own major technology acquisition phase over the past 2 years (and is hardily done with its acquisitions). With new mobile management in place, including from its biggest rival, it looks like Oracle is finally getting serious about being a credible mobile threat. Acquiring Bitzer is a first step in what I expect to be more acquisition oriented mobile enhancements that will help Oracle regain some competitive advantage for its infrastructure products and applications.
While IBM and Oracle clearly see the maturing of the mobile market as an opportunity to expand their reach and meet customer’s demand for improved mobile infrastructure, these acquisitions are an indication of seismic changes taking place in mobility that have broad implications for nearly all companies.
Most small mobile technology vendors will not independently survive beyond 2-3 years. That means enterprises with products installed from these companies will have to evaluate change/upgrades. In consolidating markets, some vendors remain in play for a number of years, but their ability to grow will be severely curtailed and their products will likely stagnate.
The big players will accelerate consolidation by buying more technology, especially related to security. If you have mobile products installed, your current vendor of choice may ultimately end up being part of IBM, SAP, Oracle, Cisco, Microsoft, Citrix, McAfee, etc. Smaller vendors not acquired will have a difficult future.
Mobile has gone mainstream and integrating mobility into all aspects of a company’s operations is key to long term success. All the large infrastructure vendors know this. The time when they could ignore mobility as a niche play not big enough to be noticed is over.
Cloud-based mobility solutions are now important to cloud-based infrastructure players. If you are a cloud vendor and you don’t have a significant mobile component, you are not a cloud player longer term. The major cloud vendors (e.g., IBM, Amazon, MSFT, SAP, etc.) are all acquiring mobile integrated solutions. Expect more acquisitions to come and more emphasis on cloud based mobility services.
Bottom Line: If you have a mobile installation (and if you don’t you’re at a serious competitive disadvantage), and have MDM, MAM, EMM or other mobile directed products from the many smaller niche players in the market, you may soon discover that your enterprise mobility vendor is being acquired.
A few pure mobile players of larger size (e.g., AirWatch, MobileIron) will survive. Many with unique technology (of which there are dozens) will be acquired, or simply fade. Consolidation over the next 1-2 years will be fast and furious. You have been warned
venturebeat.com |
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| To: richardred who wrote (2719) | 11/24/2013 8:46:53 PM | | From: richardred | | | | Novartis Sets $5 Billion Buyback as It Seeks Faster Growth (3)
By Eva von Schaper, Bloomberg News
Friday, November 22, 2013
Nov. 22 (Bloomberg) -- Novartis AG plans to buy back $5 billion in stock over two years and said it will expand in faster-growing areas of health care such as treatments for skin and heart diseases. The shares rose the most in a month.
The repurchases will begin immediately, the Basel, Switzerland-based company said in a statement before the company’s annual investor day in London today. Novartis will develop new business segments in dermatology, heart failure, respiratory illnesses and cell therapy, it said.
The buyback is encouraging investors that Novartis is more focused on providing a return to shareholders now that former Chairman Daniel Vasella has departed, Andrew Baum, a pharmaceuticals analyst with Citigroup Inc. in London, said in a note to clients. Baum said he hopes the company commits to providing further returns to shareholders as proceeds of any asset sales pump up the company’s cash holdings.
“We anticipate further increases in cash returns as the company divests non-core assets such as animal health over the next six to 12 months,” Baum said.
The buyback is part of a 10 billion-swiss franc ($11 billion) plan announced in 2008, of which more than three- quarters still remain. Part of the mandate was used to mitigate the effect of the 2010 purchase of eye-care unit Alcon on Novartis shareholders, Eric Althoff, a spokesman for Novartis, said in a telephone interview.
‘Nice Gesture’
“The market likes a buyback,” Michael Leuchten, an analyst at Barclays Plc in London, said by phone. “I’d say it’s a nice gesture, when you do the math they’re buying back 2.5 percent of their market capitalization over two years.”
Novartis rose as much as 2.6 percent to 74.25 francs in Zurich, the steepest intraday increase since Oct. 22, and was up 1.4 percent at 2 p.m. local time. The stock has returned 32 percent this year, compared with 28 percent for the Bloomberg Europe Pharmaceutical Index.
Novartis said it wants to save 3 to 4 percent of total sales over the next two years by focusing on procurement, consolidating research and reviewing its manufacturing sites. The company had $56.7 billion in sales last year.
Pipeline Review
The drugmaker also said a review of its pipeline will lead to more approvals and higher sales by 2017. Novartis’s stable of cancer drugs and sales are set to grow annually for the next five years, despite the anticipated loss of exclusivity on its cancer drug Gleevec, the company said.
The company is interested in bolt-on acquisitions of as much as $5 billion, Chief Executive Officer Joe Jimenez said in a phone interview today, with a focus on oncology, specialty medicines, dermatology and generics. Prices for biotechnology assets “have gone through the roof,” he said, making it more difficult to add value through an acquisition in that sector.
The Alcon unit is now set to grow at a mid- to high-single digit rate. The company said last month group sales would do better than previously expected. Europe’s biggest drugmaker by sales has begun a review of units such as its animal-health operation that lack global scale.
Novartis announced this month it would sell its diagnostics unit to Grifols SA for $1.68 billion, part of a strategic review of its market segments. The company now has three units with global scale, Jimenez said: pharmaceuticals, the eye-care business Alcon and the generics arm Sandoz. Novartis has said it wants its businesses to be among the industry leaders or it will consider divesting them.
The drugmaker has identified its animal-health business as a top candidate for a sale, people familiar with the matter said this month. Novartis is also considering selling its over-the- counter medicines unit and the vaccines operation, they said, although no final decision on those assets has been made.
sddt.com
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| To: richardred who wrote (3114) | 12/5/2013 1:47:19 PM | | From: richardred | | | | Sold weighted position in Olin today, on recent strength. IMO mainly due to Dow's decision to put its chlorine division on the block. Dow's exit might be Olin's gain, but I think housing is calming down.
From memory OXY & OLN tried to merge their CA operations together at one time The FTC ruled against it. |
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| To: richardred who wrote (3332) | 12/15/2013 11:10:03 AM | | From: richardred | | | | GE Takeover Strategy Called Pivotal 2014 Issue by Morgan Stanley
By Tim Catts December 13, 2013
General Electric Co. ( GE:US) investors are looking for signs that the world’s largest maker of jet engines and medical scanners will embrace a more aggressive approach to acquisitions in 2014, according to Morgan Stanley.
Chief Executive Officer Jeffrey Immelt may earmark more money for deals next year as he makes progress toward his goal of shrinking GE’s finance unit, Nigel Coe, a Morgan Stanley analyst, said today in a note to clients. Immelt said in 2012 his focus was on “bolt-on” purchases of $4 billion or less.
GE’s mergers-and-acquisitions plans will be the most important topic at its annual winter meeting with shareholders and analysts on Dec. 18, Coe said. A faster M&A pace would signal Immelt’s interest in replacing profit from GE Capital’s consumer credit business, set for an initial public offering next year, by bulking up manufacturing.
Story: GE Turns to 3D Printers for Plane Parts
“The key question is whether GE will signal a shift up in M&A spend at its annual outlook meeting next week,” wrote Coe, who is baed in New York and has an equal-weigh rating on the shares. “We believe capital allocation in 2014 is a key debate for the stock.”
Seth Martin, a spokesman for Fairfield, Connecticut-based GE, said he couldn’t immediately comment on Coe’s note.
GE raised its quarterly dividend ( GE:US) by 16 percent to 22 cents a share today, payable on Jan. 27. The stock rose 1.2 percent to $26.86 at 3:29 p.m. in New York. The shares advanced 26 percent through yesterday, compared ( GE:US) with a 24 percent gain for the Standard & Poor’s 500 Index.
Coe projected that share repurchases may fall by 50 percent or more in 2014 from the $10 billion annual pace GE forecast for this year. That would leave more cash for M&A, he said.
In April, GE agreed to purchase Lufkin Industries Inc., a maker of oilfield machinery, for $3.3 billion to bolster its rapidly growing oil and gas division. In December 2012, it agreed to acquire Avio SpA’s aviation business for $4.3 billion, gaining control of a supplier of jet-engine components to its aviation unit.
businessweek.com |
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| To: Glenn Petersen who wrote (3455) | 12/15/2013 11:22:48 AM | | From: richardred | | | | 5 takeover failures revisited
Peter Hodson | 13/12/13 3:02 PM ET
AP Photo/The Canadian PressBlackBerry in late September received a friendly $9 per share cash bid from Fairfax Financial and partners, only to see the bid collapse 42 days later
There likely were a few disgruntled shareholders of Patheon Inc. (PTI/ TSX) in October 2009 when Lonza Group terminated its planned $710-million acquisition of the company. The proposed price? US$3.55 per share, a 25% premium on the $2.84 that Patheon was trading at the day before the deal fell through.
Having a takeover disappear is likely never much fun. But I recently had reason to wonder if those shareholders had held on. That’s because JLL Partners Inc. — which started the bidding process rolling in 2009 — on Nov. 19 offered to buy Patheon for US$9.32 per share in cash. Four years later, 163% more in value and the deal looks done.
Maybe having a takeover fail is not so bad. With that in mind, let’s look at five prior collapsed deals and see how the targets are fairing nowadays.
Roche Holding AG in January 2012 offered US$6-billion, or US$51 per share in cash, for Illumina, a maker of integrated systems for the large-scale analysis of genetic variations and biological functions.
Illumina was not happy about the bid, and fought back hard. Roche terminated the deal in April 2012. Looks like the company was right to fight back: Its shares are now just under US$100, almost double what Roche wanted to pay. At Wednesday’s high of US$102.67, they were more than double the old takeover price.
Badger Daylighting Inc. (BAD/TSX)
Clean Harbours Inc. in April 2011 offered to buy Badger for $20.50 per share in cash. It was a friendly deal approved by Badger, but shareholders fought back and voted down the deal.
Today, it sure looks like Clean Harbours would have paid a bargain price. Badger this week traded at $84 per share, more than four times the proposed takeover price less than three years later. Badger, in the hydrovac industry, is up 169% this year on strong growth in its revenue and earnings.
Mart Resources Inc. (MMT/TSX-V)
Westoil Ltd. in August 2009 announced the $79-million acquisition of Mart in a cash bid of 14¢ per share. The deal fell apart 74 days later.
Today, Mart, an oil producer in Nigeria, sports a $458-million market cap and a $1.29 per share price. Interestingly, Mart’s annual dividend of 20¢ per share now exceeds the proposed takeover price of four years ago.
Yahoo Inc. (YHOO/Nasdaq)
In our most-famous example, Microsoft Corp. in February 2008 bid US$31 per share in cash and stock for Yahoo, a potential US$41-billion takeover. The deal was terminated after three months of wrangling. Microsoft in 2011 was widely rumoured to be back at the negotiating table for Yahoo, only this time at US$16.60 per share, reflecting lower prices after the financial crisis.
Today, though, is a different story: Yahoo shares — now trading near US$40 — are up more than 100% in the past year, and earnings growth is looking better. Instead of selling out, Yahoo has instead bought back lots of its own stock, including US$5.3-billion worth of shares since January 2012.
BlackBerry Ltd. (BB/TSX)
Alas, sometimes a failed bid means a lower price. Blackberry in late September received a friendly $9 per share cash bid from Fairfax Financial Holdings Ltd. and partners, only to see the bid collapse 42 days later.
Blackberry shares are now trading near their 15-year low in the low $6 range. Maybe, if shareholders are lucky, Blackberry shares years from now will be higher than the prior $9 bid.
Overall, however, the next time one of your companies receives a takeover bid, maybe you should pause first before jumping up and down with joy. You might — just might — be better off with no deal at all.
business.financialpost.com |
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| To: richardred who wrote (3405) | 12/16/2013 11:49:34 AM | | From: richardred | | | | Bolt on acquisition for Valeant. It compliments Obagi Medical .
Message 28788522
Valeant to acquire Solta Medical for $236 million
Reuters
3 hours ago
Dec 16 (Reuters) - Valeant Pharmaceuticals International said on Monday it would acquire Solta Medical Inc for about $236 million in cash, giving it access to products used in procedures such as skin rejuvenation, skin tightening and body contouring.
Last month, Solta said it had retained Piper Jaffray as its adviser to explore a possible sale, in light of falling profits from its medical equipment business and pressure from activist investor Voce Capital Management LLC.
Valeant would acquire all of the outstanding common stock of Solta for $2.92 per share in cash, which represents a 40 percent premium to Solta's closing share price on Dec. 13. The deal is expected to close in the first quarter of 2014.
"The acquisition of Solta will bring tremendous value to Valeant's current aesthetic portfolio and together with our previous acquisitions, will create the broadest aesthetic portfolio in the industry," said Valeant Chief Executive Michael Pearson, in a statement.
finance.yahoo.com |
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| To: richardred who wrote (2740) | 12/17/2013 11:51:52 AM | | From: richardred | | | | Sold position awhile back.
Campbell Seen as Next Buffett Target Post-Heinz: Real M&A.Campbell Soup Co. ( CPB:US), the maker of Goldfish crackers and chicken noodle soup, may be next on acquirers’ grocery lists after the $29 billion takeover of H.J. Heinz Co. this year.
Campbell options contracts surged this month amid speculation the $13 billion company could attract takeover interest. After 3G Capital and Berkshire Hathaway Inc. ( A:US) agreed in February to buy ketchup maker Heinz, investors are eyeing Campbell as the next big target in the packaged food industry, said Edward Jones & Co. Investment firm 3G may be interested because of the benefits of combining Heinz’s and Campbell’s vegetable processing, and Warren Buffett’s Berkshire could help bankroll a deal again, Sanford C. Bernstein & Co. said.
Like Heinz, Campbell has a strong brand, which may appeal to other food makers and financial buyers, said S&P Capital IQ. Even as Campbell faces slowing sales of its iconic soups as consumers turn to fresher foods and competing brands such as Progresso, the company still offers a buyer the biggest share of the soup market at 22 percent. While a takeover would need approval from family members owning more than 40 percent of Campbell’s shares ( CPB:US), the company also is more affordable than 70 percent of food-manufacturing peers based on its price-earnings ratio, according to data compiled by Bloomberg.
Video: Campbell Soup Seen as Next Course for Buffett
Campbell has “obviously got some brands that are really worthwhile,” Jack Russo, a St. Louis-based analyst at Edward Jones, said in a phone interview. After the acquisition of Heinz, “investors tend to think where there’s one, there could be two or three” deals.
Soup Decline Carla Burigatto, a spokeswoman for Camden, New Jersey-based Campbell, declined to comment on a potential sale of the company. A representative for 3G declined to comment, and Buffett didn’t respond to a request for comment sent to an assistant.
A month ago, Campbell reported a decline in first-quarter soup sales and said profit for the year ending in July will be less than previously forecast ( CPB:US). Amid market-share losses to rivals such as Progresso-maker General Mills Inc. ( GIS:US), Campbell has been focusing on bolstering its beverage division.
Story: The German Economics of Chicken Foot Soup
Campbell has made acquisitions since 2011 to catch up with shifting consumer preferences, including the purchases of juice maker Bolthouse Farms and baby food purveyor Plum Organics.
After Berkshire and 3G announced the acquisition of Heinz on Feb. 14, shares of Campbell advanced along with other consumer stocks such as General Mills and J.M. Smucker Co. Campbell rose as much as 6.2 percent that day for the biggest intraday gain since 2008.
Buffett, 3G One thing that drew Buffett and 3G to Heinz was the opportunity to use the acquisition “as a platform to sort of get bigger around the global food industry,” Bill Johnson, former chief executive officer of the ketchup maker, said during a February conference call.
Story: Dear Ma, Dear Pa: Welcome Back ... Watch Your Back
If 3G is seeking to increase its foothold in packaged foods, Campbell “would definitely be next on the list,” Alexia Howard, a New York-based analyst at Bernstein, said in a phone interview. “Heinz’s big businesses are largely vegetable-based. Obviously, they’ve got tomato ketchup here in the U.S., and in the U.K., they’ve got a soup business that’s actually very like Campbell’s. There probably would be a lot of benefits on the vegetable procurement front.”
Campbell saw record volume Dec. 6 in a series of bullish options ( CPB:US) that will pay off if the stock advances more than 5 percent by the end of this week. More than 20,000 contracts of $43 December calls changed hands that day, compared with an average daily volume of about 60, data compiled by Bloomberg show.
‘Classic Example’ Henry Schwartz, president of Trade Alert LLC, a New York-based provider of options-market data and analytics, said it was “a classic example of what takeover speculation looks like in the options market.”
Story: A Lucrative Promise for India's Men: Whiter Skin
While 3G likely lacks the financial resources to acquire Campbell on its own as it digests the Heinz takeover, Buffett could use his deep pockets ( B:US) to help fund a deal sooner, Howard said.
Berkshire also already owns candy maker See’s Candies, and helped finance the purchase of Wm. Wrigley Jr. Co. by Mars Inc. in 2008. Buffett has praised the business model of turning commodity ingredients into premium-priced products.
businessweek.com |
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| To: richardred who wrote (3545) | 12/17/2013 4:06:15 PM | | From: Glenn Petersen | | | | Despite Doldrums in Deal Activity, a Few Highlights This Year
By STEVEN DAVIDOFF
DealBook
New York Times
December 17, 2013, 3:04 pm
The deal world remained muted this year in terms of big transactions and activity. According to Dealogic, the number of announced takeovers in the United States so far this year was down about 22 percent, while volume was $1.1 trillion, up about 15 percent from last year but still below the level in the years before the financial crisis. . Despite the relative doldrums, there were still some highlights and lowlights. Here are some of them:
THOMA BRAVO FLIPS DIGITAL INSIGHT TO NCR The private equity firm Thoma Bravo receives an A for buying Digital Insight for $1.025 billion then selling it 124 days later to NCR for $1.65 billion. The real loser was the initial seller, Intuit, which lost out on $600 million in profit because it reportedly insisted on a quick sale timetable, which strategic buyers like NCR couldn’t meet. Sometimes it pays to take it slow. Intuit receives an F.
US AIRWAYS AND AMERICAN AIRLINES The merger of the two airlines left US Airways’ management in charge even though American was the larger airline. American’s creditors and shareholders still cheered as they received something almost as rare as a unicorn: a full recovery in bankruptcy. The two airlines’ biggest feat, though, and what warrants an A, was extracting a favorable settlement from the Justice Department, which clearly overreached in a lawsuit brought to halt the combination.
COMMONWEALTH REIT/CORVEX The father and son duo who head CommonWealth — Barry and Adam Portnoy — and CommonWealth’s counsel at Skadden Arps showed little regard for shareholder rights, doing everything in their power to prevent Corvex Management and the Related Companies from removing the Portnoys. The Portnoys banked on CommonWealth’s unique requirement that shareholders arbitrate all disputes with the company to stymie the two hedge funds. It didn’t work, and the arbitration panel ruled against CommonWealth, clearing the way for the funds to begin a campaign to unseat them. The Portnoys receive an F.
JOS. A. BANK’S BID FOR MEN’S WEARHOUSE Jos. A. Bank made a daring $2.3 billion bid for its bigger men’s clothing rival, teaming up with Golden Gate Capital for a significant equity infusion to make the bid credible. Jos. A. Bank’s management, including its chairman, Robert Wildrick, receive an A for cleverly inviting a counterbid from Men’s Wearhouse by saying a combination of the two made sense no matter the form. Men’s Wearhouse took the bait, dusting off the beloved but seldom-used Pac-Man defense. The only thing to sort out now is which set of shareholders receive a premium and who runs the combined company.
ELAN/ROYALTY/PERRIGO Irish takeover laws limited its defenses, but the Irish pharmaceutical company Elan still earned an A by fending off a $6.7 billion hostile bid from Royalty Pharma in time to put itself up for sale, ending with a much higher $8.6 billion bid from Perrigo. Elan showed that a good defense could be played off fundamentals and not simply a poison pill or other defenses that it could have used in the United States.
ADVANTAGE RENT A CAR/HERTZ GLOBAL HOLDINGS./FRANCHISE SERVICES OF NORTH AMERICA Less than a year after Hertz was forced by the Justice Department to sell Advantage to satisfy antitrust concerns stemming from its acquisition of Dollar Thrifty, Advantage filed for bankruptcy. So much for that remedy, which receives a big fat F.
HEDGE FUND ACTIVISM The hostile raiders of the 1980s have been reborn as hedge fund activists, with all the ego to boot. The successes are stunning and deserve A’s, including Third Point’s involvement with Yahoo and Pershing Square’s dealings with Canadian Pacific; the failures are real and clearly F’s, like Pershing Square and its involvement with J.C. Penney and Edward Lampert’s running of Sears. Still, there is no doubt that this is the biggest trend of the decade, one that is here to stay. It will continue to inspire even as it borders on the absurd, as Third Point and Carl C. Icahn’s machinations with Apple showed. TWITTER I.P.O. Call it the anti-Facebook. Twitter earned an A by simply doing what a company should do in an initial public offering. Don’t get tricky with pricing or numbers or try to push boundaries. Twitter simply sold shares to the public with great success.
RUE21/APAX Apax agreed to buy rue21, the fashion retailer, including shares held by an older Apax fund. When rue21 announced a sharp downturn in sales, the markets began to wonder whether the deal made sense and whether Apax would try to walk away. Faced with a tough contract and perhaps a different view of rue21’s prospects, Apax completed the deal at the initial price. The lenders lost hundreds of millions of dollars while Apax’s old fund cashed out. It remains to be seen how Apax’s new investors will do. The deal highlighted the conflicts when a private equity firm purchases a company that it already holds shares in. It’s not an F, but a warning for future private equity deals.
SOFTBANK/SPRINT/CLEARWIRE The boards of Clearwire and SoftBank did good jobs as after some initial hesitancy. Clearwire succeeded in pushing Sprint, a controlling shareholder, to raise its final bid while SoftBank was able to hold together its acquisition of Sprint itself. A’s to both companies.
HONG KONG STOCK EXCHANGE/ALIBABA The Chinese Internet giant Alibaba wants to be just like the technology giants in the United States, including having a share structure that preserves control with management after it completes its heavily anticipated I.P.O. Kudos and an A to the Hong Kong Stock Exchange for standing up to Alibaba and refusing to bend its one-share one-vote rule to accommodate Alibaba’s proposal. Alibaba is instead likely to go where the regulations are weaker: the United States.
NEW YORK STOCK EXCHANGE/INTERCONTINENTAL EXCHANGE An American institution is acquired by a company that didn’t exist 15 years ago and is a creation of technology, showing that technology almost always wins these days.
ATLANTIC COAST FINANCIAL/BOND STREET HOLDINGS The Atlantic Coast board receives an F for agreeing to an acquisition in which 40 percent of the merger consideration would be deposited into an escrow, but it neglected to negotiate an escrow agreement. Public shareholders protested and the escrow was eliminated, but shareholders still did the rare thing of rejecting the deal.
DELL MANAGEMENT BUYOUT A Dell special committee negotiated a model management buyout with all the bells and whistles intended to protect shareholders, even going so far as to reimburse the Blackstone Group $25 million to persuade it to bid. The committee stayed cool throughout a process in which shareholders, including Mr. Icahn, nudged and pushed the committee to consider alternatives. Many shareholders still complained that Dell would have been better off as a publicly traded company. We’re going to defer a complete grade on this deal as we wait to see whether Michael S. Dell can succeed in turning around his company outside of the scrutiny of the public markets, but Mr. Dell still gets an A for putting up more cash to buy out the public shareholders when his financial partner, Silver Lake, wouldn’t. A shake of the head also goes to Mr. Icahn for being his wily self and making what appeared to be a hocus-pocus nonoffer, then offering advice for shareholders to seek appraisal before forgoing the remedy himself.
DOLE MANAGEMENT BUYOUT Dole was taken private by its chief executive, David H. Murdock, for the second time in a turnstile management buyout. The $1.15 billion price was just about adequate and had the endorsement of Institutional Shareholder Services, the big proxy adviser, but one was left to wonder whether this wasn’t the case of a controlling shareholder clearing the field. Indeed, shareholder litigation remains because of Delaware’s penchant to avoid enjoining deals for substantive reasons. Meanwhile, shareholders barely approved the deal with a vote of 50.9 percent of the shares not held by Mr. Murdoch, who receives an F.
Happy New Year! Pineapple for all!
dealbook.nytimes.com |
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