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Risk Arbitrage Related News
 in chronological order

 See also: Risk Arbitrage Related Books, Risk Arbitrage Related Scholarly Papers, or Risk Arbitrage Home Page.

Table of Contents:
 

Money follows hot metal on M&A hit-list

June 16, 2006
From The Sydney Morning Herald:
METALS are the new green on Wall Street, with mining taking over from financial services as the biggest source of mergers and acquisitions.

The value of announced mining takeovers more than tripled to $US199 billion ($212 billion) in the first five months of 2008 from a year ago, even as the global pace of M&A dropped 37 per cent, data compiled by Bloomberg show.

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M&A soars as companies grab opportunities

June 15, 2006
From Financial Times:
The value of mergers and acquisitions within Asia is soaring as the region’s leading companies take advantage of opportunities to build scale and secure resources in fast-growing markets closer to home.

The aggregate value of announced cross-border deals between Asia-Pacific companies has totalled $54bn in the year to date, according to figures from Dealogic, the data provider. This compares to $25.7bn during the corresponding period last year.

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Most U.S. Stocks Gain on Acquisitions; Wrigley, Ford Advance

April 28, 2006
From Bloomberg:
Most U.S. stocks rose for a fourth day after billionaire Warren Buffett financed the $23 billion takeover of Wm. Wrigley Jr. Co. and investor Kirk Kerkorian bought a stake in Ford Motor Co.

Wrigley, the world's biggest maker of chewing gum, jumped the most since at least 1980 after Mars Inc., backed by Buffett, agreed to acquire the company for 28 percent more than its closing price last week. Ford rallied after Kerkorian said he bought 4.7 percent of the second-largest U.S. automaker and plans to buy more. Microsoft Corp. slumped for a second day, helping drag the Standard & Poor's 500 Index and Dow Jones Industrial Average lower, on speculation the world's largest software company will have to increase its bid to acquire Yahoo! Inc.

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Risk arbitrage opportunities in Global Copper and CHC Helicopter and M&A heats up

April 21, 2006
From Financial Post:
Canadian M&A activity has picked up with eight new deals announced since March. However, accessing debt continues to remain a challenge and Industry’s Canada recent rejection of Macdonald Dettwiler & Associates Ltd.’s $1.33-billion satellite division sale to Alliant Techsystems Inc. signals the increasing role national security is playing in takeovers.

Wellington West analyst Shawn Chopra said this will ultimately lead to increased spreads in M&A transactions involving foreign companies. “We believe that leveraged buyouts will have wide spreads relative to the pre-credit crisis (pre- August 2007) because access to debt will be difficult,” he told clients in a note.

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Wall Street Beat: M&A news dominates market turmoil

March 21, 2006
From The Washington Post:
Merger and acquisition sagas involving Yahoo, 3Com, and Iomega grabbed the attention of IT investors this week as economic news took tech companies on a turbulent market ride.

Continuing efforts to remain independent or force Microsoft to bid higher, Yahoo Monday revealed a three-month-old financial presentation originally prepared for its board of directors in December. Yahoo said it will double its operating cash flow from US$1.9 billion to $3.7 billion over three years. Shares of Yahoo jumped by $1.81 to close at $27.66 Tuesday.

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Indian M&A: All Talk, Little Action

March 20, 2006
From The Wall Street Journal:
Ultimately, the promise of a widespread mergers and acquisitions binge by Indian companies may be more talk than action.

With the value of companies depressed in both Europe and the U.S., fast-growing Indian companies have been touted as aggressive buyers. To seal the deal, however, will require following the Boy Scout’s motto: Be Prepared.

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Human Capital Key to M&A Success
March 14, 2007
From The Korea Times:
 Two companies merge, hoping for a more powerful business. But too many times what's meant to be a strategic combination ends up in failure because these giant deals are missing a vital link to success, says an M&A director at Hay Group.

"A balance in human capital between the two companies is a must because a cooperative organization powers a business to its target,'' David Derain, who leads the M&A work in the global management consultancy, said in a Korea Times interview Wednesday.
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Morgan Stanley Europe M&A Chairman Zaoui Will Retire (Update3)

March 13, 2007
From Bloomberg:
 Morgan Stanley said Michael Zaoui, chairman of European mergers and acquisitions, is retiring after 21 years at the second-biggest U.S. securities firm.

Zaoui, 51, was based in London since 1990 and led the firm in transactions such as Elf Aquitaine SA's 51-billion euro ($79 billion) takeover by Total Fina SA in 2000. He also advised Lafarge SA on its acquisition of Egypt's Orascom Construction Industries for 8.8 billion euros in December. Spokesman Michael Wang confirmed Zaoui's move without giving details. No replacement has been named.

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Hedge Funds Rebound In February
March 6, 2007
From FINalternatives:
 After a terrible start to the new year, four of the six hedge fund strategies covered by Dow Jones Hedge Fund Indexes posted positive returns for the month of February.

Merger arbitrage, which so far remains the only strategy with positive gains for the year, and equity long/short were the leaders for the month with net-of-fees gains of 1.95% and 1.49%, respectively.
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BofA/Countrywide Merger Arbitrage Opportunity
March 3, 2007
From Seeking Alpha:
 On January 11th, Bank of America (BAC) announced a definitive agreement to purchase Countrywide Financial (CFC) in an all-stock transaction valued at approximately $4 billion. Under the terms of the agreement, shareholders of Countrywide will receive 0.1822 shares of Bank of America for each share in Countrywide. At the time of announcement, parties expected the deal to be completed in the third quarter of 2008.

This merger agreement followed an investment by Bank of America in Countrywide, announced on August 22nd of last year, in which Bank of America made a $2 billion strategic investment in Countrywide. This was done through a 7.25% non-voting convertible preferred security, with a conversion price of $18 per share. With the merger announcement almost five months later, Countrywide is valued at just over $7 per share.

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Global M&A value slumps 49 pct year-on-year in Feb, private equity down 82 pct
February 29, 2007
From Forbes:
 In February, the total worldwide value of announced mergers and acquisitions dropped 49 pct to about 185.3 bln usd compared to 363,740.2 bln usd in February 2007, according to data from Thomson Financial.

The value of announced private equity deals, at about 16.5 bln usd, was almost 82 pct lower than the February 2007 figure of 89,098.2 bln eur, and only amounted to about 9 pct of total M&A activity.
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South Korea firms in quest for more M&A deals in U.S.
February 29, 2007
From Reuters:
 South Korean companies are hunting for U.S. acquisitions as subprime woes throw up opportunities to move into a market in which they would otherwise have to start from scratch, a senior investment banker said on Friday.

Demand ranges from manufacturers to banks and size from $100 million all the way up to $5 billion, ChunKee Lee, who leads Credit Suisse' South Korean operations, told Reuters in an interview.
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Bankers look to Liberty to show the way for M&A
February 12, 2007
From Financial Times:
 Bankers braced for a slowdown in M&A activity are rushing to sell the virtues in uncertain markets of cash shells and "blank cheque" acquisition companies.

They have been fired up by last week's listing of Liberty International, Europe's second "special purpose acquisition vehicle" (Spac), which raised €600m ($870m) listing on Euronext.
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Microsoft, Yahoo stay in the M&A game
February 12, 2007
From MarketWatch:
 As Yahoo Inc. and Microsoft Corp. battle it out over a proposed merger deal, the two tech giants have continued to pursue their own growth strategies through smaller deals.

Faced with the threat of being gobbled up by Microsoft, Yahoo on Tuesday announced a $160 million deal to buy Maven Networks Inc, which helps media companies manage and distribute online video.
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Prudential chief sees M&A chances in market turmoil
January 23, 2007
From Reuters UK:
 The head of Prudential, Britain's second-largest insurer, said the current economic turmoil could provide it with the chance to snap up rivals.

"These types of crises do present opportunities," Prudential Chief Executive Mark Tucker told Reuters on the sidelines of a summit of business leaders and policymakers in the Swiss resort of Davos.
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Stocks rollercoaster another nail in M&A coffin
January 23, 2007
From Guardian Unlimited:
 Roller-coaster stock moves make it hard to price assets and play on the nerves of company executives, which in turn makes it difficult to pull off mergers and acquisitions.

And global stocks have had a volatile week, with a big emergency rate cut by the U.S. Federal Reserve offsetting heavy share falls on Monday and early Tuesday caused by fears of a U.S. recession.
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Standard & Poor's Launches Family of Arbitrage Indices
January 17, 2007
From CNNMoney.com:
 Standard & Poor's, the world's leading index provider, announced today the launch of a family of indices designed to model common arbitrage strategies in the financial markets. The three indices -- the S&P 500 Volatility Arbitrage Index, the S&P Currency Arbitrage Index and the S&P Long Only Merger Arbitrage Index -- are the first in what will be a series of arbitrage indices launched by Standard & Poor's in 2008.

"The S&P Arbitrage Index family will offer an investable framework for tracking common arbitrage opportunities in the financial markets," says Srikant Dash, Head of Global Research and Design at Standard & Poor's. "These three indices are the first, in what will be, a series of arbitrage indices launched by Standard & Poor's in 2008."
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Study Sparks Regulator Scrutiny of Merger Arbitrage
January 14, 2007
From The New York Times:
 With the rise of proprietary trading desks, investment banks sometimes find themselves taking positions in the stocks of companies they are advising in merger talks. At least a few of those instances are probably coincidental, and the firms will certainly argue that they are.

But an academic study released last month suggests something more troubling: that as investment banks advise companies in takeover situations, they are also investing in the targets of these merger talks. The research, which says the rate of such investments is too high to be merely coincidental, has now interested securities regulators as well, The Wall Street Journal reported Monday.
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Microsoft M&A Guru to Leave
January 10, 2007
From The New York Times:
 A day after signing a $1.2 billion deal to buy a Norwegian search company, Fast Search and Transfer, Microsoft confirmed that Bruce Jaffe, the firm’s mergers and acquisitions architect, will be leaving the company at the end of February.

Mr. Jaffe, vice president of corporate development at Microsoft, had been charged with overseeing key acquisitions at a time when the company has sought to buy its way further into strategic Internet and advertising markets to compete with its surging rival, Google.
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