Deals: Global M&A Brews 2008’s Top Week

In our M&A Roundup for the period ended July 20, four deals of more than $4 billion follow InBev/Anheuser, leading to the richest seven days in mor...
Roy HarrisJuly 21, 2008

A surge in North American deals, capped by the $58.9-billion InBev agreement to buy Anheuser-Busch, carried the week’s total to the highest level since last July 9, when more than $100 billion of transactions were struck.

That 12-figure week, of course, came near the end of the greatest first-half ever for mergers and acquisitions — when companies signed $1 trillion worth of them. But dealmaking of the past seven days was hardly a slouch.

After the InBev deal came a $9.39-billion acquisition by iron-ore mining company Cleveland-Cliffs Inc. for coal producer and steam marketer Alpha Natural Resources. Weighing in at $8.74 billion was the purchase of Barr Pharmaceuticals by Israeli pharma giant Teva Pharmaceutical Industries, followed by Royal Dutch Shell’s $5.36-billion purchase of Calgary, Canada-based Duvernay Oil Corp.

Newsmakers also made M&A news among the top ten North American deals recorded in data provided to CFO.com by mergermarket. In the largest private transaction, Bloomberg Inc. agreed to pay Merrill Lynch $4.42 billion for 20 percent of New York City-based media company Bloomberg LP.

In all, 42 deals worth a total of $93.19 billion were struck in the week, up from 40, worth $29 billion, in the prior seven days. Dealmaking so far this year — totaling $570.82 billion — is now about half the $1.14 trillion that had been recorded as of July 20, 2007.

InBev SA to buy Anheuser-Busch Cos. for $58.9 billion

The St. Louis-based brewing giant signed a definitive agreement to be acquired by Leuven, Belgium-based InBev, with both boards approving a merger at $70.00 a share, a premium of 5.26 percent. Before including assumed debt, the transaction is worth about $49.9 billion. It is expected to close by Dec. 31.
Seller financial advisor: Citigroup Inc; Goldman Sachs; Merrill Lynch; Moelis & Company; UBS
Bidder financial advisor: BNP Paribas; Deutsche Bank; JPMorgan Cazenove; Lazard
Seller legal advisor: Latham & Watkins; Simpson Thacher & Bartlett ; Skadden Arps Slate Meagher & Flom ; Weil Gotshal & Manges
Bidder legal advisor: Allen & Overy; Clifford Chance; Linklaters; Paul Weiss Rifkind Wharton & Garrison; Sullivan & Cromwell

Cleveland-Cliffs Inc. to buy Alpha Natural Resources Inc for $9.39 billion

Abingdon, Va.-based coal supplier Alpha Natural Resources, which produces, processes, and sells steam and metallurgical coal, definitively agreed to be acquired by Cleveland-Cliffs, Ohio’s international mining company — a producer of iron ore pellets and supplier of metallurgical coal to steelmakers globally. Both boards approved the merger at a price of 0.95 of a Cleveland-Cliffs share and $22.23 cash for each Alpha share, making the total $128.12 per share. Not including debt, the value is $9 billion for the transaction, which is expected to close by the end of 2008.
Seller financial advisor: Citigroup
Bidder financial advisor: JPMorgan
Seller legal advisor: Latham & Watkins; Cleary Gottlieb Steen & Hamilton
Bidder legal advisor: Jones Day; Davis Polk & Wardwell

Teva Pharmaceutical Industries Ltd. to buy Barr Pharmaceuticals Inc. for $8.74 billion

Woodcliff Lake, N.J.-based Barr, with specialty pharmaceutical operations in more than 30 countries, definitively agreed to be acquired by Teva, of Petach Tikva, Israel, which develops, produces, and markets generic drugs covering all major treatment categories. Both boards approved the merger at a price of $39.90 per share in cash and 0.6272 of a Teva share, a total per-share value of $66.50 and a premium of 42 percent. Not including assumed debt, the value of the transaction, expected to close later this year, is about $7.2 billion.
Seller financial advisor: Banc of America Securities
Bidder financial advisor: Lehman Brothers
Seller legal advisor: Simpson Thacher & Bartlett
Bidder legal advisor: Willkie Farr & Gallagher; Tulchinsky Stern & Company; Goodwin Procter

Royal Dutch Shell plc to buy Duvernay Oil Corp. for $5.36 billion

Calgary-based Duvernay, which explores for and develops natural gas and crude oil, with an emphasis on the deeper, western portion of the Western Canadian Sedimentary Basin in Alberta and Northeastern British Columbia, definitive;u agreement to be acquired by Royal Dutch Shell. Based in the Hague, Shell engages globally in the aspects of the oil and natural gas industry. Both boards approved the merger at a price of $82.06 per share, a premium of 42.03 percent. Not including debt assumed, the deal is valued at about $4.9 billion.
Seller financial advisor: Peters & Co
Bidder financial advisor: Goldman Sachs
Seller legal advisor: Burnet Duckworth & Palmer
Bidder legal advisor: Osler Hoskin & Harcourt

Bloomberg Inc. to buy 20 percent of Bloomberg LP from Merrill Lynch for $4.42 billion

Bloomberg, the New York media company and provider of information services , agreed to acquire the stake in Bloomberg LP from New York City-based Merrill Lynch, the provider of investment, financing, insurance, and related services.
Seller financial advisor: Internal
Bidder financial advisor: Geller & Company, Quadrangle Group
Seller legal advisor: Sullivan & Cromwell ; Sidley Austin
Bidder legal advisor: Willkie Farr & Gallagher

BP America Production Co. to buy the Arkoma Basin Woodford Shale properties from Chesapeake Energy Corp. for $1.75 billion

Houston-based BP American, an energy company, agreed to acquire the shale properties from Chesapeake Energy, an Oklahoma City, Okla.-based producer of natural gas in a deal expected to close on Aug. 8.
Seller financial advisor: Meagher Oil & Gas
Bidder financial advisor: Not Available
Seller legal advisor: Not Available
Bidder legal advisor: Not Available

Yara International ASA to buy Saskferco Products Inc. from Canadian Imperial Bank of Commerce, Investment Saskatchewan, and the Mosaic Co. for $1.58 billion

Oslo-based Yara, a producer and marketer of mineral fertilizers, agreed to acquire Regina, Canada-based nitrogen fertilizer producer Saskferco. The sellers are Mosaic, a Plymouth, Minn.-based producer of plant nutrients, animal feed phosphates, and industrial products; Saskatoon, Canada-based investment company Investment Saskatchewan; and Toronto-based Canadian Imperial Bank of Commerce. The transaction is expected to close in the third quarter.
Seller financial advisor: CIBC World Markets
Bidder financial advisor: Citigroup
Seller legal advisor: MacPherson Leslie & Tyerman
Bidder legal advisor: Not Available

Bank of Nova Scotia to buy E*TRADE Canada from ETrade Financial Corp. for $440 million

Toronto-based Bank of Nova Scotia (Scotiabank) agreed to acquire Toronto-based E*TRADE Canada, the online securities trading services provider, from New York City-based financial services company ETrade Financial.
Seller financial advisor: JPMorgan
Bidder financial advisor: Scotia Capital
Seller legal advisor: Clifford Chance
Bidder legal advisor: McCarthy Tetrault

ViroPharma Inc. to buy Lev Pharmaceuticals Inc. for $393 million

Exton, Pa.-based biopharmaceutical company ViroPharma agreed to acquire New York City-based Lev Pharmaceuticals, which develops therapeutic products. The price is $442.9 million, including assumed cash. Terms call for a price of $2.75 per share, consisting of $2.25 in cash and 50 cents paid inViroPharma’s common stock, subject to a collar. Also, Lev holders will receive $1 per share through two payments if the company meets certain targets, such as Lev’s product Cinryze getting the approval from Food and Drug Administration, and reaching $600 million in net sales. The price represents a 49-percent premium. It is expected to close by the end of the year.
Seller financial advisor: JPMorgan
Bidder financial advisor: JPMorgan; Piper Jaffray
Seller legal advisor: Willkie Farr & Gallagher; Becker & Poliakoff
Bidder legal advisor: DLA Piper; Cravath Swaine & Moore; Latham & Watkins

Chaparral Energy LLC to buy Edge Petroleum Corp. for $379 million

Oklahoma City-based oil and gas production and exploration company Chaparral agreed to acquire Houston-based Edge, an oil and natural gas company, for stock. The value is $134.4 million not counting assumed debt. Terms call for each Edge share to be converted into 0.2511 shares of Chaparral, with the deal expected to close in the fourth quarter.
Seller financial advisor: Houlihan Lokey; Merrill Lynch
Bidder financial advisor: Royal Bank of Scotland Group; SunTrust Robinson Humphrey Capital Markets
Seller legal advisor: Baker Botts
Bidder legal advisor: McAfee & Taft

source: mergermarket