Toronto’s WSP Global buys Ecology & Environment

Ecology & Environment to be acquired by WSP Global for $65.1M

Ecology and Environment announced that it has entered into a definitive merger agreement with WSP Global, pursuant to which WSP will acquire E & E for cash.

EEI sold for $65.1M, Stockwinners

E & E has approximately 775 employees, predominantly in offices across the United States, with an additional presence in Latin America. With its US operations representing approximately 80% of its 2018 $US 73.5 million in net revenues, E & E’s portfolio includes work on the New York State Offshore Wind Master Plan, Climate Change Adaptation Planning in San Mateo County, California, and work on large federal programs with agencies including the US Environmental Protection Agency, the US Army Corps of Engineers, and the US Navy.

Under the terms of the agreement, E & E’s shareholders will receive $15.00 in cash, and a special dividend of up to 50c, for each share of Class A and Class B common stock they own. The special dividend is conditioned on and will be paid following the completion of the transaction and is subject to downward adjustment in certain circumstances.

WSP buys EEI for $65.1 M.

Under the terms of the Agreement, the merger consideration is approximately $US65.1 million in the aggregate, including a special dividend of approximately $US 2.2 million.

The merger agreement and the transaction have been unanimously approved by E & E’s Board of Directors.

In addition, E & E’s founders Frank Silvestro, Ronald Frank and Gerald Strobel, a trust affiliated with E & E’s late founder Gerhard Neumaier, each member of E & E’s Board of Directors and affiliates of Mill Road Capital have all signed voting agreements in support of the transaction.

The merger consideration, together with the special dividend of up to 50c, represents a premium of approximately 52.9% over E & E’s closing share price of $10.14 on August 27, 2019.

The merger agreement provides for a “go-shop” period of 30 days, during which E & E – with the assistance of Robert W. Baird & Co. Incorporated – will contact and potentially enter into negotiations with, and provide due diligence access to, third parties that offer potentially superior proposals to the proposed transaction with WSP.

E & E will have the right to terminate the merger agreement to enter into a superior proposal subject to the conditions and procedures specified in the merger agreement.

There can be no assurance this process will result in a superior proposal. E & E does not intend to disclose developments about this process unless and until the Board has made a decision with respect to any potential superior proposal.

The closing of the transaction is subject to customary closing conditions, including the approval of E & E’s shareholders and applicable regulatory approvals.

The parties are targeting a closing in the fourth quarter of calendar year 2019, subject to receipt of applicable regulatory approvals.

Alexandre L’Heureux, President and Chief Executive Officer of WSP, said, “We are pleased by the opportunity to have E & E join WSP, as we share a similar culture and strategy, centered around employees and clients. This Acquisition, which is in line with our 2019-2021 Global Strategic Plan, will enable us to increase both our Strategic Advisory Services offering and our presence in the United States, most particularly the US governmental sector. E & E, which is recognized for its expertise in environment, has built experience in sectors and services that WSP had targeted for growth, including environmental impact assessment, emergency planning and management, as well as site restoration.”

EEI is up $5.05 to $15.05.

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Feds Cut Rates on All Instruments!

Federal Reserve cuts federal funds target rate by 25 basis points

The Federal Reserve said in today’s statement, “Information received since the Federal Open Market Committee met in June indicates that the labor market remains strong and that economic activity has been rising at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low.

Powell, FOMC Chair, Stockwinners
Fed Chief Powell. Stockwinners.com

Although growth of household spending has picked up from earlier in the year, growth of business fixed investment has been soft.

On a 12-month basis, overall inflation and inflation for items other than food and energy are running below 2 percent. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.

In light of the implications of global developments for the economic outlook as well as muted inflation pressures, the Committee decided to lower the target range for the federal funds rate to 2 to 2-1/4 percent. This action supports the Committee’s view that sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2 percent objective are the most likely outcomes, but uncertainties about this outlook remain.

As the Committee contemplates the future path of the target range for the federal funds rate, it will continue to monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion, with a strong labor market and inflation near its symmetric 2 percent objective.”

Long Term Rates

The Federal Reserve also said in today’s statement, “In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective.

This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. The Committee will conclude the reduction of its aggregate securities holdings in the System Open Market Account in August, two months earlier than previously indicated.”

Bernanke came up with “Quantitative Easing” in 2008, Stockwinners

If you have no idea what the above paragraph means, this may help. Back in 2008, Ben Bernanke, then the Fed Chair, came up with a clever idea! Since the rates at the time where near zero. He needed a way to lower the rates, he started buying long term government bonds. The added demand for bonds caused bond prices to rise thus pushing the rates lower. In the past few quarters, the Feds have been selling these bonds, pushing prices lower, thus higher long term rates. Today’s announcement basically says Feds are ending the bond sales two months earlier, long term rates (mortgage prices) will now go lower.

Powell Comments

Federal Reserve Chair Jerome Powell said the easing was to ensure against downside risks, as he begins his press conference.

He acknowledged the shift in the policy stance since December’s pivot. Fed has seen both positive and negative developments since the June meeting, including a stronger job market, but weaker manufacturing and disappointing foreign growth, while contacts continue to cite ongoing trade uncertainties are giving companies pause.

The Committee has gradually lowered the assessments of growth and that led to the easing today. On whether a 25 bp cut will prop up inflation, he noted one has to look at the Committee’s actions over the year as it’s moved to a more accommodative stance.

The Committee is thinking of today’s action as a mid-cycle adjustment to policy, designed to provide support for the economy, ensure against downside risks, and support inflation. Chair Powell continued to appeal to downside risks and below target inflation as the main threats to the favorable outlook.

He added, the Fed will monitor the evolution of trade uncertainty, which do seem to be having significant effect on the economy. He thinks trade is a new factor that the FOMC will have to assess “in a new way.”

The chair again said it’s not appropriate to just look at the quarter point easing, but rather the evolution of the Fed’s stance from tightening to easing, with the economy picking up since the end of 2018, which suggests monetary policy is working (though he declined to take full credit for the economy’s gains).

10-year yields fall, Stockwinners
Ten year yields approach 2.00 percent, Stockwinners

Market Action

The Fed repeated it will “monitor” incoming information and will “act as appropriate to sustain the expansion,” not really suggesting the path ahead. The long end of the Treasury market is leading the way with the benchmark 10-year 4.4 bps lower to test 2.00, versus 2.023% just ahead of the announcement. The 2-year is down 1.4 bps to 1.83% versus 1.81% earlier. Hence, the curve has flattened to 17 bps from around 20 bps previously.

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Sotheby’s sold for $3.7 billion

Sotheby’s to be acquired in cash transaction valued at $3.7B

Sotheby’s to be acquired in cash transaction valued at $3.7B, Stockwinners

Sotheby’s (BID) announced that it has signed a definitive merger agreement to be acquired by BidFair USA, an entity wholly owned by media and telecom entrepreneur as well as art collector, Patrick Drahi.

Sotheby’s operates as an auctioneer of authenticated fine art, decorative art, jewelry, wine, and collectibles in the United States, the United Kingdom, Hong Kong, China, Switzerland, France, and internationally. The company operates in two segments, Agency and Finance. The Agency segment accepts property on consignment; and matches sellers to buyers through the auction or private sale process.

Under the terms of the agreement, which was approved by Sotheby’s Board of Directors, shareholders, including employee shareholders, will receive $57.00 in cash per share of Sotheby’s common stock in a transaction with an enterprise value of $3.7B.

The offer price represents a premium of 61% to Sotheby’s closing price on June 14, 2019, and a 56.3% premium to the company’s 30 trading-day volume weighted average share price.

The transaction would result in Sotheby’s returning to private ownership after 31 years as a public company traded on the New York Stock Exchange.

Tad Smith, Sotheby’s CEO, said, “Patrick Drahi is one of the most well-regarded entrepreneurs in the world, and on behalf of everyone at Sotheby’s, I want to welcome him to the family. Known for his commitment to innovation and ingenuity, Patrick founded and leads some of the most successful telecommunications, media and digital companies in the world.

He has a long-term view and shares our brand vision for great client service and employing innovation to enhance the value of the company for clients and employees.

This acquisition will provide Sotheby’s with the opportunity to accelerate the successful program of growth initiatives of the past several years in a more flexible private environment.

It positions us very well for our future and I strongly believe that the company will be in excellent hands for decades to come with Patrick as our owner.”

The closing of the deal is subject to customary conditions, including regulatory clearance and shareholder approvals, but is not subject to the availability of financing.

The transaction is expected to close in the fourth quarter of 2019 following shareholder approval. LionTree Advisors is serving as financial advisor to Sotheby’s in connection with the transaction, and Sullivan & Cromwell LLP is serving as the company’s legal counsel.

BNP Paribas and Morgan Stanley are acting as financial advisors to BidFair, BNP Paribas acted as sole financing provider, and Hughes Hubbard & Reed LLP and Ropes & Gray International LLP are serving as its legal advisors.

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No more rate hikes in 2019

Majority of Fed members see rates unchanged for rest of 2019

Members see rates to remain unchanged in 2019, Stockwinners

Minutes from the last Federal Reserve meeting read, “With regard to the outlook for monetary policy beyond this meeting, a majority of participants expected that the evolution of the economic outlook and risks to the outlook would likely warrant leaving the target range unchanged for the remainder of the year.

Several of these participants noted that the current target range for the federal funds rate was close to their estimates of its longer-run neutral level and foresaw economic growth continuing near its longer-run trend rate over the forecast period.

Participants continued to emphasize that their decisions about the appropriate target range for the federal funds rate at coming meetings would depend on their ongoing assessments of the economic outlook, as informed by a wide range of data, as well as on how the risks to the outlook evolved.

Short term rates should decline as 30-year rates rise, Stockwinners

Several participants noted that their views of the appropriate target range for the federal funds rate could shift in either direction based on incoming data and other developments.

Some participants indicated that if the economy evolved as they currently expected, with economic growth above its longer-run trend rate, they would likely judge it appropriate to raise the target range for the federal funds rate modestly later this year.”

Economic growth in 2019 likely lower than previous forecast

“Participants continued to view a sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2 percent objective as the most likely outcomes over the next few years.

Underlying economic fundamentals continued to support sustained expansion, and most participants indicated that they did not expect the recent weakness in spending to persist beyond the first quarter.

Nevertheless, participants generally expected the growth rate of real GDP this year to step down from the pace seen over 2018 to a rate at or modestly above their estimates of longer-run growth. Participants cited various factors as likely to contribute to the step-down, including slower foreign growth and waning effects of fiscal stimulus.

A number of participants judged that economic growth in the remaining quarters of 2019 and in the subsequent couple of years would likely be a little lower, on balance, than they had previously forecast. Reasons cited for these downward revisions included disappointing news on global growth and less of a boost from fiscal policy than had previously been anticipated.”


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Ascendis Pharma reports positive data, shares jump

Phase 3 heiGHt trial met primary objective in children with pediatric growth hormone deficiency

Ascendis Pharma (ASND) announced positive top-line results from the phase 3 heiGHt Trial, a randomized, open-label, active-controlled trial that compared once-weekly TransCon Growth Hormone to a daily growth hormone in children with pediatric growth hormone deficiency.

Ascendis Pharma reports positive data, shares jump, Stockwinners

The trial met its primary objective, demonstrating that TransCon hGH was observed to be non-inferior and, additionally, superior to the daily hGH on the primary endpoint of annualized height velocity at 52 weeks.

In the primary analysis of the intent-to-treat population using ANCOVA, TransCon hGH demonstrated an AHV of 11.2 cm/year compared to 10.3 cm/year for the daily hGH.

The treatment difference was 0.86 cm/year with a 95% confidence interval of 0.22 to 1.50 cm/year.

The AHV for TransCon hGH was significantly greater than the daily hGH.

The AHV was greater for TransCon hGH than for the daily hGH at each visit, with the treatment difference reaching statistical significance from and including week 26 onward.

The incidence of poor responders was 4% and 11% in the TransCon hGH and daily hGH arms, respectively. All sensitivity analyses completed from the trial support the primary outcome, indicating the robustness of these results.

Results from the trial indicate that TransCon hGH was generally safe and well-tolerated, with adverse events consistent with the type and frequency observed with daily hGH therapy and comparable between arms of the trial.

ASND is up $44.64 to $113.95.

Cantor Fitzgerald analyst Alethia Young raised her price target for Ascendis Pharma to $185 from $100 as she was “positively surprised” that the TransCon hGH study for growth hormone achieved a superior result on annualized growth velocity of .86cm.

The analyst thinks that the expectation had been non-inferiority with a slightly favorable numerical trend. Young also thinks safety was clean as well, which has been a challenge with other long acting growth hormones.

She would expect shares to trade up 50%-100% based on her model, and sees continued upside from shares as additional programs, such as TransCon PTH, achieve proof of concept and more candidates from the proprietary TransCon platform enter the clinic. The analyst reiterates an Overweight rating on the shares.

Growth hormone (GH) has been available for management of the short stature associated with growth hormone deficiency (GHD) for more than 60 years; recombinant DNA-derived human growth hormone (rhGH) has been available since 1985. While availability is no longer a problem, there still remains a number of difficulties with the diagnosis of GHD, resulting mainly from the lack of appropriate tools to make (or exclude) the diagnosis reliably.

The incidence of short stature associated with GHD has been estimated to be about 1:4000 to 1:10000 . It is the primary indication for GH treatment in childhood, which presently requires daily subcutaneous injections for the patient and substantial cost for the healthcare system. Based on these premises, it is clear that an accurate diagnosis is essential

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Kforce Government Solutions sold for $115 million

ManTech to acquire Kforce Government Solutions for $115M

KForce sold for $115 million, Stockwinners

ManTech (MANT) announced that it has signed a definitive agreement to acquire Kforce Government Solutions, or KGS, formerly a wholly-owned subsidiary of Kforce (KFRC) for $115M in cash.

Headquartered in Fairfax, Virginia, KGS provides technology solutions, transformation management, data management and analytics in support of federal health and defense missions.

KGS has built a legacy of success with its customers particularly within the Department of Veterans Affairs, or VA.

The acquisition adds over 500 employees to the ManTech team. In 2018, KGS generated approximately $98M of revenue and has profitability comparable to ManTech.

The combination will substantially increase ManTech’s footprint at the VA and enable ManTech to deliver services through the VA’s Transformation Twenty-One Total Technology Next Generation, or T4NG, program.

The T4NG program is a 10-year indefinite delivery, indefinite quantity contract awarded by the VA Technology Acquisition Center to help the VA transform its information technology programs.

ManTech will fund the acquisition from cash on hand with additional funding from its existing line of credit. ManTech expects the acquisition to be slightly accretive to earnings per share in 2019.

The acquisition is subject to various closing conditions and approvals, including approval under the Hart-Scott-Rodino Act, and is expected to be completed in March.

David L. Dunkel, Chairman and Chief Executive Officer commented, “Our federal government solutions business has been a meaningful part of our business since our initial government acquisition in 2006. I am immensely proud of the success that our KGS management team has had in growing and positioning this business for continued future success despite the competitive challenges it has faced, given its scale.

We are excited for our KGS management team and associates to join forces with ManTech, which we expect will enhance KGS’s competitive positioning and leverage its deep and long-standing customer relationships to drive further growth. We firmly believe in the strong secular drivers within the commercial technology space and, with this divestiture, virtually all of our revenues are derived from domestic professional and technical staffing services and solutions.”


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Athenahealth sold for $5.7 billion

Athenahealth to be acquired by Veritas Capital for $135 per share in cash

Athenahealth sold for $5.7 billion, Stockwinners
Athenahealth sold for $5.7 billion, Stockwinners

Athenahealth (ATHN), Veritas Capital and Evergreen Coast Capital, announced that they have entered into a definitive agreement under which an affiliate of Veritas and Evergreen will acquire athenahealth for approximately $5.7B in cash.

Under the terms of the agreement, athenahealth shareholders will receive $135 in cash per share.

The per share purchase price represents a premium of approximately 12% over the company’s closing stock price on November 9, 2018, the last trading day prior to today’s announcement, and a premium of approximately 27 percent over the company’s closing stock price on May 17, 2017, the day prior to Elliott Management Corporation’s announcement that it had acquired an approximate 9% interest in the company.

Following the closing, Veritas and Evergreen expect to combine athenahealth with Virence Health, the GE Healthcare Value-based Care assets that Veritas acquired earlier this year.

The combined business is expected to be a leading, privately-held healthcare information technology company with an extensive national provider network of customers and world-class products and solutions to help them thrive in an increasingly complex environment.

Following the close of that transaction, the combined company is expected to operate under the athenahealth brand and be headquartered in Watertown, Massachusetts.

The company will be led by Virence Chairman and Chief Executive Officer Bob Segert and an executive leadership team comprised of executives from both companies.

Following the completion of the transaction, Virence’s Workforce Management business will become a separate Veritas portfolio company under the API Healthcare brand.

Athenahealth investor Elliott Management has expressed support for the transaction.

Elliott Partner Jesse Cohn said, “We are pleased to support this transformative transaction combining athenahealth and Virence, which we believe represents an outstanding, value-maximizing outcome for athenahealth shareholders.”

Upon completion of the transaction, Elliott’s private equity subsidiary, Evergreen Coast Capital, will retain a minority investment stake in the combined company.

The transaction is expected to close in the first quarter of 2019, subject to the approval of the holders of a majority of athenahealth’s outstanding shares and the satisfaction of customary closing conditions and regulatory approvals.

The athenahealth Board of Directors has unanimously approved the merger agreement and intends to recommend that athenahealth shareholders vote in favor of it at a Special Meeting of Stockholders, to be scheduled as soon as practicable.

The transaction is not subject to a financing condition. In light of today’s announcement and the pending transaction, athenahealth will no longer be hosting its previously announced Q3 2018 earnings call.

ATHN closed at $120.35.


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Engility Holdings sold for $2.5 billion

SAIC to acquire Engility in all-stock deal valued at $2.5B

Engility Holdings sold for $2.5 billion, Stockwinners
Engility Holdings sold for $2.5 billion, Stockwinners

SAIC (SAIC) and Engility Holdings (EGL) announced that they have entered into a definitive agreement under which SAIC will acquire Engility in an all-stock transaction valued at $2.5B, $2.25B net of the present value of tax assets, creating the second largest independent technology integrator in government services with $6.5B of pro-forma last 12 months’ revenue.

The combination of these two complementary businesses will accelerate SAIC’s growth strategy into key markets, enhance its competitive position and provide significant financial benefits.

The transaction will create market sub-segment scale in strategic business areas of national interest, such as defense, federal civilian agencies, intelligence, and space.

In addition, it expands the capabilities of both companies, bringing additional systems engineering, mission, and IT capabilities to a broader base of customers.

Under the terms of the merger agreement, Engility stockholders will receive a fixed exchange ratio of 0.450 shares of SAIC common stock for each share of Engility stock in an all-stock transaction.

Based on an SAIC per share closing price of $89.86 on September 7, 2018, the transaction is valued at $40.44 per share of Engility common stock or $2.5B in the aggregate, including the repayment of $900M in Engility’s debt.

SAIC has obtained a financing commitment letter from Citigroup Global Markets Inc. for a new seven-year senior secured $1.05B term loan facility under our existing credit agreement.

The proceeds will be used to repay Engility’s existing debt and associated fees. SAIC expects no immediate change to its quarterly cash dividend as a result of this transaction.

The transaction is expected to close by the end of the fiscal fourth quarter ending February 1, 2019, following customary closing conditions, including regulatory and SAIC and Engility shareholder approvals.

The transaction has been unanimously approved by both boards.

The businesses will continue to operate separately until the transaction closes. The combined company will retain the SAIC name and continue to be headquartered in Reston, Virginia.

Following closing, Tony Moraco will continue as CEO and as an SAIC board member. SAIC will expand its board to include two additional members from Engility’s board.


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Starwood Property Trust goes shopping

Starwood Property to acquire GE Capital Project Finance Debt Business for $2.56B

Starwood Property goes shopping, Stockwinners
Starwood Property goes shopping, Stockwinners

Starwood Property Trust (STWD) announced that the company has entered into a definitive agreement to acquire GE Capital’s (GE) Energy Financial Services’ Project Finance Debt Business and loan portfolio for $2.56B, including $400M of unfunded loan commitments.

The acquired business will leverage the extensive experience of the company’s affiliate, Starwood Energy Group, which specializes in comparable energy infrastructure equity investments and has executed transactions with approximately $7B in asset value since its inception in 2005.

GE’s Energy Project Finance Debt Business includes a vertically integrated platform with a seasoned leadership team and 21 full-time employees across loan origination, underwriting, capital markets and asset management.

The Loan Portfolio consists of 51 senior loans secured by energy infrastructure real assets.

The company anticipates the transaction will be accretive to core earnings.

The company expects to finance the transaction with a new secured term loan facility from MUFG with an initial advance of approximately $1.7B and committed capacity for future funding obligations in the Loan Portfolio.

The company has ample available liquidity in addition to a $600M committed acquisition facility from Credit Suisse and Citigroup Global Markets Inc. to fund the balance of the purchase price.

The completion of the acquisition is subject to the satisfaction of a number of customary conditions and is expected to close in the third quarter of 2018.

STWD closed at $22.45. GE closed at $13.16.


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BofI to acquire $3B of deposits from Nationwide Bank

BofI in pact to acquire $3B of deposits from Nationwide Bank, sees accretion

BofI to acquire $3B of deposits from Nationwide Bank, Stockwinners
BofI to acquire $3B of deposits from Nationwide Bank, Stockwinners

BofI Holding (BOFI), parent of BofI Federal Bank, announced that the Bank has signed a deposit purchase and assumption agreement with Nationwide Bank to acquire approximately $3B in deposits from Nationwide Bank, including $1B in checking, savings and money market accounts and $2B in time deposit accounts.

BofI and Nationwide Bank expect to receive regulatory approval and complete the deposit acquisition and transfer during the fourth quarter of 2018.

“We are excited to welcome Nationwide Bank’s nearly 100,000 deposit customers to BofI,” began Gregory Garrabrants, President and Chief Executive Officer of BofI Holding, Inc.

“Our track record of successfully completing similar transactions with Principal Bank and H&R Block provide us with a high degree of confidence that we will have a seamless transition.

We look forward to offering Nationwide Bank customers our full suite of consumer, commercial and small business banking products and services once the transaction closes.”

A deposit premium commensurate with the fair market value of the deposits purchased will be funded from excess capital at the Bank. The Company expects the transaction to be immediately accretive to earnings and tangible book value.

BOFI closed at $39.64.


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Synovus to acquire FCB Financial for $2.9B

Synovus to acquire FCB Financial for $2.9B

 

Synovus to acquire FCB Financial for $2.9B, Stockwinners
Synovus to acquire FCB Financial for $2.9B, Stockwinners

Synovus Financial Corp. (SNV) and FCB Financial Holdings, Inc. (FCB) jointly announced their entry into a definitive merger agreement under which Synovus will acquire FCB Financial Holdings, Inc., owner of Florida Community Bank.

The transaction is expected to close by the first quarter of 2019.

Following the closing, FCB will merge with Synovus Bank and operate under the Synovus brand, and FCB Financial Holdings President and CEO Kent Ellert will be executive vice president of Synovus and Florida market president.

Under the terms of the merger agreement, FCB shareholders will receive a fixed ratio of 1.055 shares of Synovus common stock for each common share of FCB in an all-stock transaction.

Based on Synovus’ closing share price on July 23, 2018, the transaction is valued at $58.15 per FCB share or $2.9 billion in aggregate.

Following completion of the merger, former FCB shareholders will own approximately 30% of the combined company. In addition, based on the exchange ratio, Synovus’ most recent quarterly dividend translates to a pro forma annualized dividend of $1.06 per FCB share.

The transaction is expected to be tax free to FCB shareholders. Synovus expects approximately $40 million in pretax synergies to be fully realized by 2020.

Excluding one-time charges, Synovus expects the acquisition to be approximately 6.5% accretive to earnings per common share in 2020 and to deliver strong returns on capital.

The transaction is expected to produce tangible book value per share dilution of 3.3% with an earnback period of less than two years.

The merger agreement has been unanimously approved by both companies’ Boards of Directors.

The merger is subject to customary closing conditions, including approval by Synovus and FCB Financial Holdings shareholders and approval by state and federal bank regulators. BofA Merrill Lynch and J.P. Morgan Securities LLC served as financial advisors to Synovus on this transaction, while Simpson Thacher & Bartlett LLP and Alston & Bird LLP served as legal advisors.

Sandler O’Neill + Partners L.P., Guggenheim Securities, LLC, and Evercore Group L.L.C. served as financial advisors to FCB Financial Holdings, and Wachtell, Lipton, Rosen & Katz served as legal advisor.


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CA Technologies sold for $18.9 billion

Broadcom to acquire CA Technologies for $44.50 per share in cash

Stockwinners, Winning stock research since 1998
CA Technologies sold for $18.9 billion, Stockwinners

Broadcom (AVGO) and CA Technologies (CA) announced that the companies have entered into a definitive agreement under which Broadcom has agreed to acquire CA to build one of the world’s leading infrastructure technology companies.

Under the terms of the agreement, which has been approved by the boards of directors of both companies, CA’s shareholders will receive $44.50 per share in cash. This represents a premium of approximately 20% to the closing price of CA common stock on July 11, 2018, the last trading day prior to the transaction announcement, and a premium of approximately 23% to CA’s volume-weighted average price for the last 30 trading days.

The all-cash transaction represents an equity value of approximately $18.9B, and an enterprise value of approximately $18.4B.

The transaction is expected to drive Broadcom’s long-term Adjusted EBITDA margins above 55% and be immediately accretive to Broadcom’s non-GAAP EPS.

On a combined basis, Broadcom expects to have last twelve months non-GAAP revenues of approximately $23.9B and last twelve months non-GAAP Adjusted EBITDA of approximately $11.6B.

Broadcom intends to fund the transaction with cash on hand and $18B in new, fully-committed debt financing.

Broadcom expects to maintain an investment grade rating, given its strong cash flow generation and intention to rapidly de-leverage.

The transaction is subject to customary closing conditions, including the approval of CA shareholders and antitrust approvals in the U.S., the EU and Japan.

Careal Property Group AG and affiliates, who collectively own approximately 25% of the outstanding shares of CA common stock, have entered into a voting agreement to vote in favor of the transaction.

The closing of the transaction is expected to occur in the fourth calendar quarter of 2018.


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Cotiviti sold for $4.9 billion

Cotiviti to be acquired by Veritas Capital-backed Verscend for $4.9B in cash

Cotiviti sold for $4.9 billion, Stockwinners
Cotiviti sold for $4.9 billion

Cotiviti Holdings (COTV) and Verscend Technologies, a portfolio company of Veritas Capital announced that they have entered into a definitive agreement whereby Verscend has agreed to acquire Cotiviti for $4.9B in cash.
Under the terms of the agreement, Cotiviti shareholders will receive $44.75 in cash per share of Cotiviti common stock, and Verscend will assume all of Cotiviti’s outstanding debt, resulting in an enterprise value of approximately $4.9B.
The offer price represents a 32% premium to Cotiviti’s unaffected share price as of June 4, 2018 and a 136% premium to the initial public offering price of Cotiviti’s common stock.
The transaction, which was unanimously approved by Cotiviti’s Board of Directors, is expected to close during the fourth quarter of 2018.
Closing of the transaction is subject to the approval of Cotiviti shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals.
Advent International has entered into a voting agreement whereby it has agreed to vote shares representing approximately 44% of the company’s voting power in favor of the transaction.


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Exact Sciences higher on colon cancer screening

Cologuard maker jumps as colon cancer screening now recommended earlier

Cologuard maker jumps as colon cancer screening now recommended earlier , Stockwinners
Cologuard maker jumps as colon cancer screening now recommended earlier

Shares of Exact Sciences (EXAS) are on the rise after the American Cancer Society released an updated guideline for colorectal cancer screening, saying screening should begin at age 45 for people at average risk.

Previously, the guideline recommended screening begin at age 50 for people at average risk.

UPDATED GUIDELINE

The American Cancer Society released an updated guideline for colorectal cancer screening.

Among the major guideline changes, the new recommendations say screening should begin at age 45 for people at average risk. Previously, the guideline recommended screening begin at age 50 for people at average risk.

Additionally, the American Cancer Society also recommended that people who are in good health and with a life expectancy of more than 10 years should continue regular colorectal cancer screening through the age of 75.

Recommendations for screening test options are also part of the guideline changes.

“There are some differences among the tests to consider, but the most important thing is to get screened, no matter which test you choose,” the American Cancer Society said in a statement, listing the differences between stool-based tests and visual exams.

LEERINK COMMENTS

After the American Cancer Society updated its guideline for colorectal cancer screening to recommend screening begin at age 45 for people at average risk, Leerink analyst Puneet Souda said this is “only directionally positive” for Exact Sciences.

#Souda said the ACS recommendation does not automatically translate into becoming a reality in clinical practice in the near-term, nor does it mean the USPSTF and NCCN automatically follow suit. Souda maintains an Outperform rating on Exact Sciences shares.

PRICE ACTION

In Wednesday’s trading, shares of Exact Sciences have gained over 8% to $56.96. The company sells stool-based test Cologuard, a noninvasive colorectal cancer screening test.


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DCT Industrial Trust sold for $8.4B

Prologis to acquire DCT Industrial Trust for $8.4B

DCT Industrial Trust sold for $8.4B. Stockwinners
DCT Industrial Trust sold for $8.4B. 

Prologis (PLD) and DCT Industrial Trust (DCT) announced that the two companies have entered into a definitive merger agreement by which Prologis will acquire DCT for $8.4B in a stock-for-stock transaction, including the assumption of debt.

The boards of directors of both companies have unanimously approved the transaction.

The transaction is anticipated to create substantial synergies, including near-term synergies of approximately $80M in corporate general and administrative cost savings, operating leverage, interest expense and lease adjustments, which are forecast to increase annual stabilized core funds from operations per share by 6c-8c.

A combination of revenue synergies and incremental development volume has the potential to generate $40M of additional annual revenue and development profit in the future.

Under the terms of the agreement, DCT shareholders will receive 1.02 Prologis shares for each DCT share they own. The transaction, which is currently expected to close in the third quarter of 2018, is subject to the approval of DCT stockholders and other customary closing conditions.

At closing, it is anticipated that Philip L. Hawkins will join the Prologis board of directors.

PLD closed at $66.58.  DCT closed at $58.75.


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