It doesn’t take a very close examination to see that North American dealmaking is becoming a creature of the credit crisis — in more ways than one.

Again this week, the largest transaction in the seven-day period grew directly from the flurry of high-level negotiations designed to save one or another of the nation’s once-mighty financial institutions. But beneath that, the second tier is populated with smaller and smaller deals, continuing a disturbing trend for the merger-and-acquisition set.

Last week came the “bailout fallout” in its purest form: Wells Fargo’s $15.1-billion offer for a weakened Wachovia — followed by two related Mitsubishi deals for Morgan Stanley and the disposition of a Lehman Brothers and an American International Group operation — were the only instances of M&A in billion-dollar territory.

The rest of the top ten deals, according to data provided to CFO.com by mergermarket, involved various transactions in the energy, software, and video-game sales fields.

In all, 53 transactions worth a total of $28.19 billion were announced in the week, compared with 47 deals, valued at $17.09 billion, in the prior week. For the year to date, the 3,007 deals, worth $790 billion, continued to be a shadow of the 2007 record year. At this time last year, 3,945 transactions had been proposed, with a value of $1.33 trillion.

Wells Fargo & Co. to buy Wachovia Corp. for $15.12 billion

Charlotte, N.C.-based financial and bank holding company Wachovia definitively agreed to be acquired by San Francisco-based Wells Fargo in an exchange of 0.1991 Wells Fargo share for each Wachovia share, or $7 a share and a premium of 44. 14 percent. Citigroup, however, is challenging the deal, arguing that an earlier deal negotiated by the Federal Deposit Insurance Corp. should stand. That FDIC transaction would combine Citi and Wachovia.
Seller financial advisor: Goldman Sachs; Perella Weinberg Partners
Bidder financial advisor: JPMorgan
Seller legal advisor: Sullivan & Cromwell
Bidder legal advisor: Wachtell Lipton Rosen & Katz

Mitsubishi UFJ Financial Group Inc. to buy an undisclosed economic interest in Morgan Stanley for $6.05 billion

Tokyo-based financial group Mitsubishi agreed to acquire preferred shares that are convertible into 13.6 percent stake of New York City-based Morgan Stanley. Terms call for Mitsubishi UFJ to acquire perpetual non-cumulative convertible preferred stock, with a conversion price of $31.25 per share and a 10-percent dividend. After one year, if the price of Morgan Stanley common stock exceeds 150 percent of the conversion price, 50 percent of the preferred stock will be converted into common, and after two years the remainder will be converted.
Seller financial advisor: Morgan Stanley
Bidder financial advisor: BlackRock; Lazard; Mitsubishi UFJ Securities
Seller legal advisor: Cravath Swaine & Moore; Wachtell Lipton Rosen & Katz
Bidder legal advisor: Mori Hamada & Matsumoto; Sullivan & Cromwell

Mitsubishi to buy 9.9 percent stake in Morgan Stanley for $2.95 billion

Mitsubishi also agreed to acquire a 9.9 percent stake in Morgan Stanley, with terms calling for the Japanese banking giant to get 117 million shares for $25.25 each, a premium of 2.02 percent.
Seller financial advisor: Morgan Stanley
Bidder financial advisor: BlackRock; Lazard; Mitsubishi UFJ Securities
Seller legal advisor: Cravath Swaine & Moore; Wachtell Lipton Rosen & Katz
Bidder legal advisor: Mori Hamada & Matsumoto; Sullivan & Cromwell

Bain Capital LLC and Hellman & Friedman LLC to buy Neuberger Berman Inc. from Lehman Brothers Holdings Inc. for $2.15 billion

Boston-based private equity firm Bain and San Francisco based private equity firm Hellman & Friedman agreed to acquire equal stakes in investment advisory and asset management firm Neuberger Berman from New York City-based Lehman. Also, current portfolio managers, management team, and senior professionals will gain a significant stake in the company, and remain in their positions. The transaction includes all capabilities of Neuberger, which is primarily equities products and services, mutual funds, and a strong emphasis on high net worth and institutional clients. The deal also includes Lehman Brothers Asset Management, with its fixed income, commodities, and quantitative portfolio management capabilities, and Lehman’s private funds investment group. The deal doesn’t include Lehman’s merchant-banking, real-estate, or venture-capital direct private-equity businesses. The transaction is expected to be completed by early 2009.
Seller financial advisor: Barclays Capital
Bidder financial advisor: Citigroup
Seller legal advisor: Weil Gotshal & Manges; Willkie Farr & Gallagher
Bidder legal advisor: Cleary Gottlieb Steen & Hamilton; Proskauer Rose; Ropes & Gray

Global Infrastructure Partners to buy a 50-percent stake in London City Airport Ltd. from AIG Financial Products Corp. for $904 million

New York City based private equity firm Global Infrastructure agreed to acquire the stake in London City Airport from Wilton, Conn.-based AIG Financial, which is involved in derivatives markets and a subsidiary of American International Group. The transaction is expected to complete by October 2008.
Seller financial advisor: Not Available
Bidder financial advisor: Not Available
Seller legal advisor: Not Available
Bidder legal advisor: Slaughter and May

GameStop Corp. to buy Micromania SAS from L Capital for $700 million

Grapevine, Tex.-based video games retailer GameStop agreed to acquire Micromania SAS, the privately-held Valbonne, France based video game retailer, from L Capital, the Paris, France based private equity firm and a division of LVMH Moet Hennessy Louis Vuitton SA, the Paris, France based luxury goods conglomerate, for a cash consideration of $700m. The acquisition is subject to approval from European Commission and expected to close in November 2008.
Seller financial advisor: Lazard
Bidder financial advisor: Citigroup
Seller legal advisor: Ayache, Salama & Associes; Mayer Brown
Bidder legal advisor: Bryan Cave

Pilot Corp. to buy a 50-percent StokaPilot Travel Centers from Marathon Oil Corp. for $700 million

Knoxville, Tenn.-based Pilot, an operator of convenience stores, agreed to acquire the remaining 50 percent stake in Pilot Travel from Houston-based Marathon. Pilot operates travelling centers. The transaction is expected to be completed this month.
Seller financial advisor: JPMorgan
Bidder financial advisor: Internal
Seller legal advisor: Internal
Bidder legal advisor: Internal

Hewlett-Packard Co. to buy Lefthand Networks Inc. for $360 million

Palo Alto-based technology company H-P agreed to pay cash for LeftHand Networks, the privately held Boulder, Colo-bbased provider of storage virtualization and iSCSI storage area network. The transaction is expected to be completed in H-P’s first fiscal quarter of 2009.
Seller financial advisor: Merrill Lynch
Bidder financial advisor: Not Available
Seller legal advisor: Holme Roberts & Owen
Bidder legal advisor: Wilson Sonsini

MidAmerican Energy Holdings Co. to buy a 9.89-percent stake in BYD Co. Ltd. for $232 million

MidAmerican, a privately held, Des Moines-based investment holding company engaged in production, transportation, and delivery of energy, agreed to acquire 225 million H shares in BYD, a Shenzhen, China-based rechargeable battery and automobile manufacturer. The price of $1.03 a share , represents a discount of 4.76 percent.
Seller financial advisor: UBS
Bidder financial advisor: Not Available
Seller legal advisor: Not Available
Bidder legal advisor: Not Available

Access Industries Inc. to buy a controlling stake in Megapage Co. for $200 million

Access, a New York City-based industrial holding company, acquired the stake in Moscow-based Megapage. a distributor of wireless connection and positioning technology, for an undisclosed consideration that was estimated to be in the range of $200 million to $250 million.
Seller financial advisor: Not Available
Bidder financial advisor: Not Available
Seller legal advisor: Not Available
Bidder legal advisor: Not Available

source: mergermarket