Deals: Delta Flies Away with the Honors

In our M&A Roundup for the week ended April 20, a tepid week was led by its $7.12-billion proposed acquisiton of Northwest.
Roy HarrisApril 21, 2008

The $7.12-billion merger proposal between Delta Air Lines and Northwest Airlines soared above an otherwise meager crowd of transactions last week, as dealmakers could come up with only three deals worth more than $1 billion.

In all, there were 46 mergers or acquisitions involving North American companies, worth a total of $11.31 billion in the week ended Sunday. In the prior week there were 51 deals valued at $18.04 billion, according to data provided to CFO.com by mergermarket.

The following list represents the Top 10, with Delta/NWA being followed by Manitowoc Co.’s $2.07-billion deal for British food and beverage equipment maker Enodis. The third billion-dollar deal was an international private-equity consortium’s purchase of a 24.9-percent stake in Munich-based Hypo Real Estate Holding AG.

For the year to date, dealmaking rose to 1,109 deals valued at $183.92 billion, far below the 1,588 transactions worth $502.16 billion at the same time in 2007.

Delta Air Lines Inc. to buy Northwest Airlines Corp. for $7.12 billion

Eagan, Minn.-based Northwest definitively agreed to be acquired by Atlanta-based Delta in an exchange of 1.25 shares of Delta for each Northwest share. The $13.10 value provides a premium of 16.8 percent, and values the target at $3.10 billion before assumption of debt.
Seller financial advisor: JPMorgan; Morgan Stanley
Bidder financial advisor: Greenhill & Co; Merrill Lynch
Seller legal advisor: O’Melveny & Myers; Simpson Thacher & Bartlett
Bidder legal advisor: Hunton & Williams; Wachtell Lipton Rosen & Katz

Manitowoc Co. Inc. to buy Enodis Plc from for $2.07 billion

The Manitowoc, Wis. industrial equipment and machinery company agreed to acquire all outstanding share capital of London-based Enodis in a $5.08-a-share ex-dividend cash transaction that offers a premium of 82.3 percent.
Seller financial advisor: Credit Suisse; Rothschild
Bidder financial advisor: JPMorgan; Morgan Stanley
Seller legal advisor: Ashurst; Internal
Bidder legal advisor: Davis Polk & Wardwell; Foley & Lardner; Linklaters

Grove International Partners LLP, J.C. Flowers & Co. LLC, and Shinsei Bank Ltd. to buy a 24.9-percent stake in Hypo Real Estate Holding AG for $1.80 billion

A consortium of New York-based private equity firm J.C. Flowers, Tokyo-based Shinsei Bank, and London-based investment bank and private equity firm Grove International agreed to acquire Munich-based Hypo Real Estate for $35.87 a share, a premium of 21.8 percent.
Seller financial advisor: JPMorgan
Bidder financial advisor: Morgan Stanley
Seller legal advisor: Shearman & Sterling
Bidder legal advisor: Hengeler Mueller

Caja Madrid (Caja de Ahorros y Monte de Piedad de Madrid) to buy 83 percent of City National Bank of Florida from City National Bancshares for $927 million

The Madrid-based credit and savings bank agreed to pay cash for the 83- percent stake in Miami-based City National Bank from its Newark, N.J.-based parent, a bank holding company. Acquirer Caja Madrid, which already has a corporate bank branch in Miami, aims to gain access to new markets in the region like Tampa, Orlando, and Jacksonville. Leonard Abess, current chairman and CEO of City National Bank, will retain his current position and his 17 percent holding.
Seller financial advisor: Not available
Bidder financial advisor: Not available
Seller legal advisor: Powell Goldstein
Bidder legal advisor: Avila, Rodriguez, Hernandez, Mena & Ferri

XTO Energy Inc. to buy the Appalachian Basin oil and gas interests of Linn Energy LLC for $600 million

Fort Worth-based XTO is engaged in the acquisition, development, exploitation, and exploration of producing oil and gas properties. It agreed to acquire Houston-based Linn’s Appalachian Basin oil and gas interests for cash in a deal expeced to close on July 1.
Seller financial advisor: Lehman Brothers
Bidder financial advisor: Not disclosed
Seller legal advisor: Internal
Bidder legal advisor: Not disclosed

LightHouse Holdings Inc. to buy 90 percent of American Beacon Advisors from AMR Corp. for $480 million

Chicago-based LightHouse is owned by investment funds affiliated with Pharos Capital Group and TPG Capital. It specializes in acquisition and consolidation of marketing services companies. Fort Worth-based American Beacon is an asset management company owned by the parent company of Fort Worth-based American Airlines. The deal is expected to close in the summer.
Seller financial advisor: Credit Suisse
Bidder financial advisor: Merrill Lynch
Seller legal advisor: Kelly Hart & Hallman
Bidder legal advisor: Cleary Gottlieb Steen & Hamilton

Teck Cominco Ltd. to buy Global Copper Corp. for $402 million

Vancouver, B.C.-based Teck Cominco, a diversified mining company, agreed to pay $11.76 a share in cash or 0.26667 of a Tck Class B subordinate voting share for each share of Global Copper, a mining company also based in Vancouver. The price , BC based mining company, for an approximate consideration of $406m or $402m taking into Global Copper’s cash position. Under the agreement, Teck is offering $11.76 in cash per share or 0.26667 of a Teck Class B subordinate voting share per Global common share. The total to be paid is $101 million in cash and $305 million in shares in the deal, with a premium of 13.1 percent. The transaction is expected to close on or before Sept. 30.
Seller financial advisor: Raymond James
Bidder financial advisor: BMO Capital Markets
Seller legal advisor: Borden Ladner Gervais
Bidder legal advisor: Lang Michener

Martin Marietta Materials Inc. to buy six quarries in Georgia and Tennessee from Vulcan Materials Co. for $192 million

Raleigh, N.C.-based Martin Marietta Materials, a construction and chemicals group, is acquiring the six quarry operations from Birmingham, Ala.-based Vulcan, a manufacturer of construction aggregates, materials, and industrial chemicals, for an undisclosed price, although estimates say it is more than $192 million.
Seller financial advisor: Internal
Bidder financial advisor: Not available
Seller legal advisor: Wachtell, Lipton, Rosen & Katz; Alston & Bird; and Hunton & Williams
Bidder legal advisor: Not available

ADT Security Services Inc. to buy FirstService Security from FirstService Corp. for $187 million

Boca Raton, Fla.-based ADT, a provider of electronic security services provider, agreed to pay cash for FirstService, a Collegeville, Pa.-based provider of integrated security systems services. Parent FirstService Corp. is based in Toronto, and provides various property services.
Seller financial advisor: William Blair & Company
Bidder financial advisor: Not available
Seller legal advisor: Not available
Bidder legal advisor: Not available

CapitalSource TRA Inc. to buy retail assets and 22 retail banking branches of Fremont Investment & Loan for $170 million

Chevy Chase, Md.-based financial service provider Capital Source TRA is a subsidiary of Capital Source Inc., a commercial finance, investment, and asset management company focused on the middle market. It is acquiring the branches and assets of Fremont Investment from its Santa Monica, Calif.-based parent Fremont General Corp. The deal is expected to close by the third quarter.
Seller financial advisor: Credit Suisse; Sandler O’Neill & Partners
Bidder financial advisor: Citigroup
Seller legal advisor: Patton Boggs
Bidder legal advisor: Bingham McCutchen

source: mergermarket