In the M&A world, it’s vital to take a page out of Alec Baldwin’s book in Glengarry Glen Ross: always be closing! If we can’t do this, we can always TALK about closing and see which companies might be thinking about it!
Here’s your Cheat Sheet to mergers and acquisitions completed last week:
- Diageo (NYSE:DEO), the British spirits maker that owns the Guinness brand, plans to acquire Mey Icki, a Turkish liquor company, for $2.1 billion. Mey Icki will be Diageo’s first big acquisition in more than ten years, and will allow Diageo to capitalize on Mey Icki’s strength as the number one producer of raki, Turkey’s national beverage.
- Blockbuster, we barely knew thee. The company decided to initiate an auction process through a “stalking horse” bid from its creditors, which include Monarch Alternative Capital, Owl Creek Asset Management, Stonehill Capital Management, and Varde Partners (together, Cobalt Video, a catchy name). Together they own more than 50 percent of Blockbuster’s senior secured notes. The price? $290 million, a paltry sum, but better than nothing considering the company is in Chapter 11 proceedings. Such a sale would help Blockbuster exit bankruptcy relatively quickly.
- Holly Corp (NYSE:HOC) and Frontier Oil (NYSE:FTO), both refinery operators, plan to merge in a deal worth $3 billion. The newly merged company, HollyFrontier Corp., will be a leading independent refiner in the U.S., serving the Mid-Continent, Rocky Mountain and Southwest refining markets. Deals like this one are a bellwether for the industry: as demand has grown for petroleum-byproducts, many refineries have experienced a surge in profits.
- Remember BHP (NYSE:BHP) and its botched attempt to acquire Potash (NYSE:POT)? Well, now BHP has something to smile about: it plans to buy Chesapeake Energy’s (NYSE:CHK) interests in Fayetteville Shale assets in Arkansas for $4.75 billion. This is good for both parties: it will allow Chesapeake to continue its plan to reduce debt by 25 percent in the next two years, and gives BHP a 45 percent increase to gas reserves and resources.
- Energy services firm Enterprise Products Partners (NYSE:EPD) will acquire natural gas services provider Duncan Energy Partners (NYSE:DEP), or at least the 42 percent is doesn’t already own, in a deal that values the company at $2.4 billion. The two companies both provide energy services for natural gas, oil, refined products and petrochemicals. This is simply another example of the hot deals going on in the energy space.
- Thermo Fisher Scientific (NYSE:TMO) is cleaning house: it will sell its Athena Diagnostics division to Quest Diagnostics (NYSE:DGX) for $740 million, and its Lancaster Laboratories business to Eurofins Scientific for $200 million. Quest Diagnostics will pay cash, and sees the acquisition as part of its plan to expand into testing for neurological diseases, which is Athena’s specialty. This is a good move, considering the demand for diagnostic testing continues to climb. In addition, Thermo Fisher announced a $750 million share repurchase program.
- Now it’s a little more than a rumor: the Pritzkers will sell a majority stake in Triton Container International to Warburg Pincus and Vestar Capital Partners. The purchase price is rumored to be around $1 billion, which values the entire company at about $3.5 billion. This deal is simply one of a series in the Pritzkers’ attempt to unwind all of their positions in various companies.
Not all deals get done. Don’t Miss: The Rumor Mill: Mergers & Acquisitions in Question >>
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