VideoBank of America Corp.'s $4.14-billion rescue/purchase of Countrywide Financial Corp. kept the week ended Saturday from being a merger-and-acquisition washout.
The deal for Countrywide, the Calabasas, Calif.-based mortgage lender devastated in the subprime lending crisis, was followed by a $1.32-billion defense industry purchase by Alliant Techsystems Inc. and a $1.06-billion addition to the Microsoft Corp. stable as the only two billion-dollar transactions among the top 10 in North America, according to data provided to CFO.com by mergermarket .
Combined with an even smaller total value of deals in the prior week, last week's 43 transactions, totaling $7.3 billion, brought the value of the 92 proposals year-to-date to $10.08 billion, sharply off from 2007's over those two weeks. In the early going during that record first half, 186 deals were struck worth $23.80 billion.
Bank of America Corp. to buy Countrywide Financial Corp. for $4.14 billion
Countrywide signed a definitive agreement in which Charlotte-based B of A will exchange 0.1822 shares of its stock for each Countrywide share, for a value of $7.16 a share that is a discount of 7.6 percent. Countrywide is engaged in mortgage lending and other real estate finance-related businesses, including mortgage banking, banking and mortgage warehouse lending, dealing in securities and insurance underwriting. B of A provides a range of banking and non-banking financial services and products through three business segments: Global Consumer and Small Business Banking, Global Corporate and Investment Banking, and Global Wealth and Investment Management. B of A expects $670 million in after-tax cost savings from the transaction, or 11 percent of the expense base of the two companies' mortgage operations. About one third of the savings would come in 2009, and two thirds in 2010, with savings being fully realized in 2011. The transaction is expected to close in the third quarter.
Seller financial advisor: Sandler O'Neill & Partners; and Goldman Sachs
Bidder financial advisor: Banc of America Securities
Seller legal advisor: Wachtell Lipton Rosen & Katz; Fried Frank (representing Goldman Sachs)
Bidder legal advisor: Cleary, Gottlieb, Steen Hamilton; and K&L Gates
Alliant Techsystems Inc. to buy the Information Systems and Geospatial Information Services units of MacDonald, Dettwiler & Associates Ltd. for $1.32 billion
Alliant, an Edina, Minn.-based provider of advanced weapon and space systems, agreed to acquire the information units of Canada's Richmond, B.C.-based MacDonald Dettwiler, which supplies products and services for aerial platforms. The Information Systems and Geospatial Information Services units provide integrated information solutions and Earth observation data. The transaction is expected to be neutral to earnings per share in fiscal year 2009, but will enhance its existing and potential content in space exploration while adding satellite ground station and geospatial imagery content. Closing is expected early in the first quarter of 2009.
Seller financial advisor: Banc of America Securities; and BMO Nesbitt Burns
Bidder financial advisor: Not available
Seller legal advisor: Farris, Vaughan, Wills & Murphy
Bidder legal advisor: Stikeman Elliott
Microsoft Corp. to buy FAST Search & Transfer ASA for $1.06 billion
The Redmond, Wash.-based software behemoth agreed to pay $3.55 for each share of FAST Search & Transfer, an Oslo-based provider of enterprise search products, a premium of 42.3 percent. ASA, the listed Oslo based provider of enterprise search solutions.
Seller financial advisor: JP Morgan; and Merrill Lynch
Bidder financial advisor: Goldman Sachs
Seller legal advisor: Raedar
Bidder legal advisor: Linklaters; Sullivan & Cromwell (Advising Goldman Sachs); and Thommessen
NuVista Energy Ltd. to buy Rider Resources Ltd. for $574 million
Calgary, Alberta-based NuVista, an oil and natural gas exploration company, agreed to pay $5.11 a share for Calgary-based Rider, an explorer and developer of oil and gas fields, a premium of 25 percent. The transaction is expected to be tax-deferred for Rider shareholders. The transaction is in line with NuVista's strategy of adding three new core areas in liquid-rich natural gas prone regions of Alberta. In connection with the deal, the Ontario Teachers’ Pension Plan agreed to subscribe for 6 million units of NuVista to be issued on a private placement basis. Each unit will be comprised of one common share in the capital of NuVista and one-half of one common share purchase warrant of NuVista. Prior to the investment, the pension plan owns about 9.8 percent of NuVista common, and when the deal is closed, expected in March, it will own about 14 percent (17 percent assuming the exercise of the common share warrants).
Seller financial advisor: FirstEnergy Capital; Scotia Waterous Inc.
Bidder financial advisor: Peters & Co
Seller legal advisor: undisclosed
Bidder legal advisor: Undisclosed
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