M&A Roundup

Regions Financial Corp. and AmSouth Bancorp; Euronext, Deutsche Borse, and NYSE Group; OMV and Verbund; BASF and Engelhard; Philadelphia Media Hold...
Helen ShawMay 25, 2006

• Regions Financial Corp. and AmSouth Bancorp, both based in Birmingham, Alabama, have agreed to a $10 billion merger through a stock swap. The combined company would have the tenth-largest market capitalization of all U.S. banks, with $126 billion.

• In a nonbinding vote, shareholders of European exchange operator Euronext have rejected a merger offer by German rival Deutsche Borse, valued at $11 billion. Euronext has reportedly asserted that the true value of the offer is lower, and its CEO has publicly expressed his preference for the NYSE Group’s $10.2 billion offer.

• OMV, Austria’s largest oil company, and Verbund, the country’s largest utility, have canceled their $16.7 billion merger. The deal, announced on May 10, succumbed to opposition by provincial officials and to public concern that the government would not control a majority of the combined company.

• German chemical company BASF has increased its hostile bid for New Jersey-based Engelhard by 2.6 percent, to $5.07 billion. The new bid, which BASF characterized as final, represents the second increase since Engelhard rejected the initial January 3 offer as too low.

• Philadelphia Media Holdings has purchased that city’s major newspapers, the Inquirer and the Daily News, from McClatchy for $562 million. The investor group, which represents entrepreneurs, labor, and corporate interests, will pay $515 million in cash and assume $47 million in pension liabilities.

• Associated British Ports, largest U.K. ports company, may consider a $4.5 billion offer by a Goldman Sachs-led group that includes the government of Singapore and a unit of a major Canadian pension fund. The new figure represents an 11 percent increase from the consortium’s March 29 offer, which was rejected.

• Wal-Mart Stores has sold its unprofitable South Korean outlets to local retailer Shinsegae for $882 million. The world’s largest retail chain had operated in South Korea’s discount-store market for eight years but garnered only a 4 percent market share.

• Aztar, the owner of the Tropicana casino in Las Vegas, has agreed to be acquired by Columbia Entertainment, the gaming affiliate of Columbia Sussex, for $2.01 billion. The agreement ends a bidding war and supercedes Aztar’s previous agreement to be purchased by Pinnacle Entertainment for $1.42 billion.

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