VideoTwo deals involving pharmaceuticals companies, and one targeting a soft-tissue products marketer, dominated a heated-up merger-and-acquisition scene last week. An extra jolt came from the infusions that a struggling subprime mortgage lender received — something that seems more than likely to continue.
The largest transaction was Novartis AG's $10.06-billion agreement to buy 24.85 percent of eye-care products maker Alcon Inc. from Nestle SA. That was followed by Japanese firm Takeda Pharmaceutical Co. Ltd. agreeing to buy Millennium Pharmaceuticals Inc. for $7.55 billion.
Number three was private equity firm TPG LLP's $2-billion investment in struggling lender Washington Mutual Inc. But after that came another life-sciences transaction: Kinetic Concepts buying LifeCell Corp. for $1.71 billion
The number of deals fell to 51 from 82, according to data provided to CFO.com by mergermarket. But the overall value of transactions climbed to $18.05 billion from the prior week's $14.37.
Private equity made a healthy appearance, with 11 deals with reported values totaling $2.49 billion.
Lots of deals remain in the buzz in this new week, including a Delta Air Lines/Northwest Airlines merger said to be near, while movie-rental company Blockbuster Inc. confirmed it had bid for Circuit City Inc. for as much as $1.3 billion — a hostile offer that seems sure to drag out in contention.
Last week's dealmaking brought the year-to-date total to $172.28 billion, in 1,052 deals, still far below the record pace of 1,492 deals worth $469.69 billion at this point in 2007.
Novartis AG to buy 24.85 percent of Alcon Inc. from Nestle SA for $10.60 billion
Basel, Switzerland-based health-care solutions provider Novartis agreed to pay Nestle for the stake in Hunenberg, Switzerland-based Alcon, which develops and makes pharmaceuticals, consumer eye-care products, and surgical equipment. Nestle, of Vevy, Switzerland, provides food and beverage products. The transaction is expected to close in June.
Seller financial advisor: Citigroup; Credit Suisse
Bidder financial advisor: Goldman Sachs
Seller legal advisor: Pestalozzi Lachenal Patry; Sullivan & Cromwell; Blake, Cassels & Graydon; Cravath Swaine & Moore; Howrey
Bidder legal advisor: Allen & Overy; Baer & Karrer; Heller Ehrman White & McAuliffe; Kaye Scholer; Latham & Watkins
Takeda Pharmaceutical Co. Ltd. to buy Millennium Pharmaceuticals Inc. for $7.56 billion
Cambridge, Mass.-based Millennium is a biopharmaceutical company focused on discovering, developing, and commercializing medicines for cancer, inflammatory bowel diseases, and other inflammatory diseases. It signed a definitive agreement to be acquired by Osaka, Japan-based Takeda Pharmaceutical, a global pharmaceutical company, at $25 a share, or a premium of 52.9 percent. Its plan is to use Millennium flagship product Velcade to help Takeda toward its goal of becoming a global leader in oncology. The implied equity value of the transaction is about $8.12 billion, including cash assumed in the deal, which is expected to close in the second quarter.
Seller financial advisor: Goldman Sachs
Bidder financial advisor: UBS
Seller legal advisor: WilmerHale
Bidder legal advisor: Edwards Angell Palmer & Dodge
TPG LLP to buy an undisclosed interest in Washington Mutual Inc. for $2. billion
Fort Worth-based private equity firm TPG agreed to acquire the undisclosed economic interest in Seattle-based Washington Mutual, a bank involved in consumer banking, mortgage lending, commercial banking, consumer finance, and financial services, through a consortium formed by undisclosed investors and many of WaMu's top institutional shareholders. They will purchase $7 billion of WaMu securities, with TPG contributing $2 billion. The $8.75-a-share represents a discount of 33.46 percent.
Seller financial advisor: Goldman Sachs; Lehman Brothers
Bidder financial advisor: Credit Suisse
Seller legal advisor: Simpson Thacher & Bartlett
Bidder legal advisor: Cleary Gottlieb Steen & Hamilton
Kinetic Concepts to buy LifeCell Corp. for $1.71 billion
Branchburg, N.J.-based LifeCell definitively agreed to be acquired by San Antonio-based Kinetic Concepts, a global medical technology company that manages advanced wound care and therapeutic surfaces. Boards of both companies approved the merger. LifeCell manufactures, processes, and markets biological soft tissue repair products made from human and animal tissue. The acquirer said it wants to achieve global leadership in the area, and to diversify the Kinetic Concepts revenue stream while combining research and development capabilities and increasing the operating-room and acute- care businesses. The $51-a-share price offers a premium of 18 percent. The transaction is expected to close in the second quarter.
Seller financial advisor: Merrill Lynch
Bidder financial advisor: JPMorgan
Seller legal advisor: Fried Frank Harris Shriver & Jacobson; Lowenstein Sandler PC
Bidder legal advisor: Cravath Swaine & Moore LLP; Skadden Arps Slate Meagher & Flom
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