Allergan sold for $63 billion

AbbVie to acquire Allergan in cash, stock deal valued around $63B

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Allergan sold for $63 billion, Stockwinners

AbbVie (ABBV) and Allergan (AGN) announced that the companies have entered into a definitive transaction agreement under which AbbVie will acquire Allergan in a cash and stock transaction for a transaction equity value of approximately $63B, based on the closing price of AbbVie’s common stock of $78.45 on June 24.

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Abbvie to pay $63B to buy Allergan, Stockwinners

Upon completion of the transaction, AbbVie will continue to be incorporated in Delaware as AbbVie Inc. and have its principal executive offices in North Chicago, IL.

AbbVie will continue to be led by Richard Gonzalez as chairman and CEO.

Two members of Allergan’s board, including chairman and CEO, Brent Saunders, will join AbbVie’s board upon completion of the transaction.

Under the terms of the Transaction Agreement, Allergan Shareholders will receive 0.8660 AbbVie Shares and $120.30 in cash for each Allergan Share that they hold, for a total consideration of $188.24 per Allergan Share.

The transaction represents a 45% premium to the closing price of Allergan’s Shares on June 24.

AbbVie anticipates that the Acquisition will provide annual pre-tax synergies and other cost reductions of at least $2B in year three while leaving investments in key growth franchises untouched.

The synergies and other cost reductions will be a result of optimizing the research and early stage portfolio, and reducing overlapping R&D resources, driving efficiencies in SG&A, including sales and marketing and central support function costs, and eliminating redundancies in manufacturing and supply chain, and leveraging procurement spend.

The synergies estimate excludes any potential revenue synergies.

AbbVie is expected to generate significant annual operating cash flow, which will support a debt reduction target of $15B to $18B before the end of 2021, while also enabling a continued commitment to Baa2/BBB or better credit rating and continued dividend growth.

It is expected that, immediately after the closing of the Acquisition, AbbVie Shareholders will own approximately 83% of AbbVie on a fully diluted basis and the Allergan Shareholders will own approximately 17% of AbbVie on a fully diluted basis.

PIPER COMMENTS

Piper Jaffray analyst Christopher Raymond said his first reaction to the deal could be summed up with the phrase “two turkeys don’t make an eagle,” but he is “willing to listen” despite his skepticism about the transaction.

Though he cannot say he is “excited at the prospect of AbbVie entering the field of medical aesthetics,” EPS accretion of 10% in year one and over 20% at peak, and the potential for meaningful deleveraging and cost cutting, has his attention, Raymond said. He keeps a Neutral rating on AbbVie based on his initial reaction to the deal announcement.

Wells Fargo

Wells Fargo analyst David #Maris said he views the deal as a good alternative for Allergan versus the current share price, but he is not convinced its a better long term alternative given the eventual biosimilar threat to Abbvie’s blockbuster drug Humira.

With that said, Maris tells investors that “deals at such premiums are rarely killed because of a bad strategic fit or longer -term value outlook in the absence of other bidders.” Though he would not completely rule out an activist investor disrupting the deal, he thinks it is unlikely given there has been a strategic review of the company for some time. Maris, who said he thinks the deal could go through, keeps an Outperform rating on Allergan shares.

Leerink 

SVB Leerink analyst Marc Goodman is not surprise that one of the large pharma companies has made a bid on Allergan (AGN) given the multi-year stock weakness.

However, he believes a $188 price is “too low,” as he “can’t believe that Allergan is not being taken out at least at $200,” which “begs the question” whether this was a process or is AbbVie (ABBV) “opportunistically pursuing a wounded stock.” If it is the latter, Goodman believes this bid could initiate others to pursue Allergan as well. He has an Outperform rating on Allegan’s shares.

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US Ecology and NRC Group to merge

US Ecology, NRC Group to merge in all-stock transaction

US Ecology and NRC Group to merge, Stockwinners

US Ecology (ECOL) announced that it has entered into a definitive merger agreement with NRC Group Holdings (NRCG) in an all-stock transaction with an enterprise value of $966M.

U.S. Ecology and NRC Group to merge, Stockwinners

The transaction is expected to close in the fourth quarter and is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, respective stockholder approvals and other customary closing conditions.

The transaction will create a nationwide leader in industrial and hazardous waste management services and is projected to be mid-single digit accretive to US Ecology’s 2020 adjusted earnings per share, before synergies.

The transaction has been approved by both companies’ Boards of Directors.

Upon completion of the transaction, US Ecology stockholders will own approximately 70% of the combined company, and NRCG stockholders will own approximately 30% on a fully diluted basis.

The combined company will use the US Ecology name, and its shares will continue to be listed on the Nasdaq Global Select Market under the ticker ECOL.

Jeffrey Feeler will continue to serve as President, CEO and Chairman of the Board of Directors.

The company will maintain its headquarters in Boise, Idaho with regional support centers in Boise, Detroit, New York and Houston.

Under the terms of the merger agreement, US Ecology will form a new holding company which will take the name of US Ecology, Inc. immediately upon the closing of the transaction and will own both US Ecology and NRCG.

US Ecology stockholders will receive 1 share of common stock of the new holding company for each share of US Ecology common stock they own upon closing of the transaction.

NRCG common stockholders will receive 0.196 shares of common stock of the new holding company for each share of NRCG common stock they own upon closing of the transaction.

The exchange ratio represents a price of $12.00 per share of NRCG stock, based on the US Ecology average share price over the last 15-trading days.

The $12.00 price per share represents a premium of approximately 36% to NRCG’s June 21 closing price of $8.83.

Each share of NRCG’s 7.00% Series A Convertible Cumulative Preferred Stock is expected to be converted in the merger into approximately 1.8 common shares of the new holding company.

NRCG’s 19.249M outstanding Warrants to purchase NRCG common stock will be converted to 3.773M Warrants to purchase common stock of the new holding company, with a strike price of $58.67 each.

The transaction will provide NRCG stockholders with continued participation in the future prospects expected to result from the combination through their ownership of approximately 30% of the stock of the new holding company, on a fully diluted basis.

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Nanometrics and Rudolph Technologies to merge

Nanometrics, Rudolph Technologies to combine in an all-stock merger of equals

Nanometrics and Rudolph to merge, Stockwinners

Nanometrics (NANO) and Rudolph Technologies, Inc. (RTEC) announced that they have agreed to combine in an all-stock merger of equals transaction.

Nanometrics and Rudolph Technologies to merge, Stockwinners

Nanometrics Incorporated provides process control metrology and inspection systems for use primarily in the fabrication of semiconductors and other solid-state devices, and industrial and scientific applications worldwide.

Rudolph Technologies, Inc. designs, develops, manufactures, and supports process control defect inspection and metrology, advanced packaging lithography, and process control software systems used by microelectronic device manufacturers. 

The merged company will be a premier end-to-end metrology, inspection, process control software, and lithography equipment provider for the semiconductor industry and other advanced markets.

Under the terms of the agreement, which was unanimously approved by the Boards of Directors of both companies, Rudolph stockholders will receive 0.8042 shares of Nanometrics common stock for each Rudolph share.

Upon completion of the merger, current Nanometrics stockholders will own approximately 50% and current Rudolph stockholders will own approximately 50% of the combined company.

Rudolph CEO Michael Plisinski will serve as Chief Executive Officer and Rudolph CFO Steven Roth will serve as Chief Financial Officer of the combined company, alongside a highly experienced leadership team comprised of executives from both companies.

The Board of Directors will be led by Nanometrics director Christopher Seams and will have 12 directors, consisting of six from each existing Board.

The combined company will be headquartered in Wilmington, Massachusetts and will maintain a strong presence at Nanometrics’ headquarters in Milpitas, California.

The transaction is expected to close in the second half of 2019, subject to the completion of customary closing conditions, including receipt of regulatory approvals, and approval by the stockholders of each company.

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Array BioPharma sold for $11.4 billion

Pfizer to acquire Array BioPharma for $48.00 per share in cash, or $11.4B

Array BioPharma sold for $11.4 billion, Stockwinners

Pfizer (PFE) and Array BioPharma (ARRY) announced that they have entered into a definitive merger agreement under which Pfizer will acquire Array, a commercial stage biopharmaceutical company focused on the discovery, development and commercialization of targeted small molecule medicines to treat cancer and other diseases of high unmet need.

Array BioPharma Inc., a biopharmaceutical company, focuses on the discovery, development, and commercialization of small molecule drugs to treat patients with cancer and other diseases. It provides BRAFTOVITM (encorafenib) capsules in combination with MEKTOVI (binimetinib) tablets for the treatment of patients with unresectable or metastatic melanoma with a BRAF mutation. The company’s lead clinical programs include encorafenib and binimetinib that are investigated in approximately 30 clinical trials for various solid tumor indications, including a Phase III trial in BRAF-mutant colorectal cancer. Its product pipeline also includes ipatasertib, an AKT inhibitor that is in Phase III trial to treat prostate or breast cancers; selumetinib, a MEK inhibitor for cancer; larotrectinib, a PanTrk inhibitor that is in a Phase II/registration clinical trial for cancer; tucatinib, a HER2 inhibitor for breast cancer, which is in Phase II/registration trial; and ARRY-797 that is in Phase III clinical trial for Lamin A/C-related dilated cardiomyopathy. 

Pfizer has agreed to acquire Array for $48 per share in cash, for a total enterprise value of approximately $11.4B.

The Boards of Directors of both companies have approved the merger. Upon the close of the transaction,

Array’s employees will join Pfizer and continue to be located in Cambridge, Massachusetts and Morrisville, North Carolina, as well as Boulder, Colorado, which becomes part of Pfizer’s Oncology Research & Development network in addition to La Jolla, California and Pearl River, New York.

Pfizer expects to finance the majority of the transaction with debt and the balance with existing cash.

The transaction is expected to be dilutive to Pfizer’s Adjusted Diluted EPS by 4c-5c in 2019, 4c-5c in 2020, neutral in 2021, and accretive beginning in 2022, with additional accretion and growth anticipated thereafter.

Pfizer will provide any appropriate updates to its current 2019 guidance in conjunction with its third quarter 2019 earnings release.

Under the terms of the merger agreement, a subsidiary of Pfizer will commence a cash tender offer to purchase all outstanding shares of Array common stock for $48 per share in cash for a total enterprise value of approximately $11.4B.

The closing of the tender offer is subject to customary closing conditions, including regulatory approvals and the tender of a majority of the outstanding shares of Array common stock.

The merger agreement contemplates that Pfizer will acquire any shares of Array that are not tendered into the offer through a second-step merger, which will be completed promptly following the closing of the tender offer.

Pfizer expects to complete the acquisition in the second half of 2019.

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Barnes & Noble sold for $683M

Barnes & Noble to be acquired by Elliott for $6.50 per share in all cash deal

Barnes & Noble sold for $683M, Stockwinners

Barnes & Noble (BKS) announces that it has entered into a definitive agreement to be acquired by funds advised by Elliott Advisors for $6.50 per share in an all-cash transaction valued at approximately $683M, including the assumption of debt.

Barnes & Noble has faced continued pressure from Amazon and independent booksellers. Its shares had fallen roughly 25% year to date before the news leak. Within the past five years, Barnes & Noble has lost more than $1 billion in market value.

Elliott’s acquisition of Barnes & Noble, the largest retail bookseller in the United States, follows its June 2018 acquisition of Waterstones, the largest retail bookseller in the United Kingdom.

James Daunt, CEO of Waterstones, will assume also the role of CEO of Barnes & Noble following the completion of the transaction and will be based in New York.

The $6.50 per share purchase price represents a 43% premium to the 10-day volume weighted average closing share price of Barnes & Noble’s common stock ended June 5, the day before rumors of a potential transaction were reported in the media.

As a private company, Barnes & Noble will likely be more free to make the changes and investment that can be unwieldy under a public spotlight. Part of the bookseller’s turnaround plan has included closing some of its more than 600 stores across the U.S. and relocating to smaller spaces that receive a fresh and modern look. The company has said its prototype stores encourage shoppers to buy books online or from a tablet.

The retailer has shown small signs of upturn. In March, it reported that over the holidays, sales at locations open for at least a year during the quarter rose 1.1 percent — its best quarterly performance in three years. As of January, it had $15 million in cash and cash equivalents.

The announced transaction with Elliott is the culmination of an extensive Strategic Alternative Review conducted by the Special Committee of the Barnes & Noble board, which was announced on October 3, 2018.

The board of Barnes & Noble unanimously approved the transaction and recommend the transaction to Barnes & Noble shareholders.

Leonard #Riggio, the Founder and Chairman of Barnes & Noble, has also entered into a voting agreement in support of the transaction.

The transaction is subject to customary closing conditions, including the receipt of regulatory and stockholder approval, and is expected to close in Q3.

The merger agreement provides for the acquisition to be consummated through a merger structure. However, the parties expect to amend the agreement to utilize a tender offer structure, which is expected to reduce the time to closing by a number of weeks.

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Cypress Semiconductor sold for $23.85 a share

Infineon to acquire Cypress Semi in deal with enterprise value of EUR9B

Infineon to acquire Cypress Semi in deal with enterprise value of EUR9B , Stockwinners

Infineon Technologies (IFNNY) and Cypress Semiconductor Corporation (CY) announced that the companies have signed a definitive agreement under which Infineon will acquire Cypress for $23.85 per share in cash, corresponding to an enterprise value of EUR9B.

The companies said that expected economies of scale will create cost synergies of EUR180M per annum by 2022.

The complementary portfolios will enable the offering of further chip solutions with a revenue synergies potential of more than EUR1.5B per annum in the long term.

The offer price represents a 46% premium to Cypress’s unaffected 30-day volume-weighted average price during the period from 15 April to 28 May 2019, the last trading day prior to media reports regarding a potential sale of Cypress.

Cypress expects to continue its quarterly cash dividend payments until the transaction closes.

This includes Cypress’s previously announced quarterly cash dividend of 11c per share, payable on July 18, 2019 to holders of record of Cypress’s common stock at the close of business on June 27, 2019.

The funding of the acquisition is fully underwritten by a consortium of banks. Infineon is committed to retaining a solid investment grade rating and, consequently, Infineon intends to ultimately finance approximately 30 percent of the total transaction value with equity and the remainder with debt as well as cash on hand.

The financial policy to preserve a strategic cash reserve remains in place. The acquisition is subject to approval by Cypress’s shareholders and the relevant regulatory bodies as well as other customary conditions.

The closing is expected by the end of calendar year 2019 or early 2020.

Hassane El-Khoury, President and CEO of Cypress, said:

“The Cypress team is excited to join forces with Infineon to capitalize on the multi-billion dollar opportunities from the massive rise in connectivity and computing requirements of the next technology waves. This announcement is not only a testament to the strength of our team in delivering industry-leading solutions worldwide, but also to what can be realized from uniting our two great companies. Jointly, we will enable more secure, seamless connections, and provide more complete hardware and software sets to strengthen our customers’ products and technologies in their end markets. In addition, the strong fit of our two companies will bring enhanced opportunities for our customers and employees.”

CY closed at $17.82. IFNNY closed at $17.77.

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Bempegaldesleukin data should send Nektar shares higher

Nektar presents biomarker, clinical data from PIVOT-02 Phase 2 study

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Nektar presents biomarker, clinical data from PIVOT-02 Phase 2 study, Stockwinners

Nektar Therapeutics (NKTR) announced that biomarker and clinical data from PIVOT-02 was presented at the 2019 American Society of Clinical Oncology Meeting in Chicago, Illinois.

#Bempegaldesleukin is an investigational, CD122-preferential IL-2 pathway agonist designed to provide sustained signaling through the IL-2 beta-gamma receptor.

Bempegaldesleukin is under investigation in clinical trial NCT03729245 (A Study of NKTR-214 in Combination With Nivolumab Compared With the Investigator’s Choice of a Tyrosine Kinase Inhibitor (TKI) Therapy (Either Sunitinib or Cabozantinib Monotherapy) for Advanced Metastatic Renal Cell Carcinoma (RCC)).

PIVOT-02 is an ongoing Phase 2 study evaluating bempeg in combination with nivolumab in solid tumors.

Exploratory biomarker analyses of PIVOT-02 baseline tumor biopsies identified immune signatures that potentially enrich for response in patients with 1L metastatic melanoma and not 1L metastatic urothelial carcinoma.

Notable response rates were seen in both 1L metastatic melanoma and 1L metastatic urothelial cancer patients, regardless of PD-L1 status or unfavorable tumor microenvironments.

At a median time of follow-up of 12.7 months, confirmed objective response rate was 53% in efficacy-evaluable patients, with 34% of patients achieving confirmed complete responses. 42% of patients achieved a maximum reduction of 100% in target lesions. DCR, also known as disease control rate was 74%.

Median time to response was 2 months. Median duration of response was not reached. At the 12.7 month median follow-up, data were too immature to calculate median progression-free survival. 80% of patients with responses have ongoing responses. Amongst the 35 patients with known pre-treatment PD-L1 status, ORR in PD-L1 negative patients was 6/14 and in PD-L1 positive patients was 13/21.

One of three patients with unknown PD-L1 baseline status experienced a CR.

A total of 6/41 of patients experienced a Grade 3 or higher TRAE with 4/41 patients discontinuing treatment due to a TRAE. A total of 41 patients have been treated at the RP2D with 3 patients discontinuing prior to 1st scan due to an unrelated treatment-emergent adverse event and patient decision.

A Phase 3 trial evaluating bempeg in combination with nivolumab versus nivolumab in first-line advanced melanoma patients is currently recruiting patients.

A Phase 2 pivotal trial evaluating bempeg in combination with nivolumab in first-line metastatic urothelial cancer is currently recruiting patients.

 Piper Jaffray

Piper Jaffray analyst Tyler Van Buren reiterates an Overweight rating and $100 price target on Nektar, and believes shares should be up significantly on Monday following updated data from the bempegaldesleukin + nivo PIVOT-02 melanoma cohort.

The increase in complete response rate from 24% to 34% at just beyond 12 months is more than the analyst and investors were anticipating and “the waterfall plot is like nothing [he has] ever seen in solid tumors.”

Ultimately, Van Buren believes the high quality of responses and the ability to maintain patients on therapy is contributing to robust durability, which increases his confidence in the ultimate outcome of the Phase III trial which will have a final mPFS evaluation around Q3 of 2020.

NKTR closed at $31.32.

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International Speedway sold for $2 billion

NASCAR to acquire International Speedway for $45.00 per share

NASCAR to acquire International Speedway for $45.00 per share, Stockwinners

International Speedway (ISCA) has entered into an agreement and plan of merger with NASCAR pursuant to which NASCAR will acquire ISC.

The transaction is valued at approximately $2B. The consideration to be paid to ISC’s shareholders will be $45.00 in cash for each share of ISC Class A common stock and ISC Class B common stock.

The merger agreement was unanimously recommended and approved by a special committee comprised solely of independent directors of the board of ISC and was unanimously approved by the full board.

NASCAR to acquire International Speedway for $2B, Stockwinners

In addition, the participating shareholders have signed a letter agreement to cause their respective shares of ISC Class A common stock and ISC Class B common stock to be transferred to NASCAR prior to the effective time of the merger.

Under the terms of the merger agreement, ISC shareholders will be entitled to receive $45.00 in cash, without interest, for each share of ISC Class A common stock and ISC Class B common stock held immediately prior to the effective time of the merger.

The transaction, which is expected to close in calendar year 2019, is conditioned on the approval of a majority of the aggregate voting power represented by the shares of ISC Class A common stock and ISC Class B common stock not owned by the controlling shareholders of ISC, voting together as a single class.

The transaction is also conditioned on other customary closing conditions.

In connection with the transaction negotiations, counsel for the plaintiff in The Firemen’s Retirement System of St. Louis v. James C. France, the previously-disclosed class action lawsuit on behalf of ISC shareholders challenging the transaction, met with representatives of the special committee and has determined to not challenge the fairness of the transaction price.

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Circor receives $1.7B takeover offer

Crane proposes to acquire Circor for $45.00 per share in cash

Crane proposes to acquire Circor for $45.00 per share in cash, Stockwinners

Crane Co. (CR) announced that it has submitted a proposal to the Board of Directors of CIRCOR International (CIR) to acquire CIRCOR for $45 per share in cash.

CIRCOR International, Inc. designs, manufactures, and markets engineered products and sub-systems worldwide. It operates through three segments: Energy, Aerospace and Defense, and Industrial. 

The proposal represents a 47% premium over yesterday’s closing price and a 37% and 51% premium over a three- and six-month volume weighted average share price, respectively.

This reflects an enterprise value of approximately $1.7B at a multiple of approximately 13.5x the last 12-month adjusted EBITDA. Crane Co. proposed the all-cash transaction to CIRCOR’s President and CEO Scott Buckhout on April 30, the terms of which were confirmed by a letter to the CIRCOR Board of Directors.

On May 13, the CIRCOR Board summarily rejected Crane Co.’s proposal with no offer of discussions or due diligence.

“While we had hoped to complete a transaction privately, the Board’s rejection of our proposal without comment or discussion led to our decision to make our proposal known to CIRCOR shareholders so they can express their views directly to the CIRCOR Board,” said Max Mitchell, Crane Co. President and CEO.

“Our proposal provides CIRCOR shareholders with attractive value and certainty compared to the continued uncertainty surrounding CIRCOR’s plans to improve operating performance.

Based on CIRCOR’s history of underperformance and inability to meet its own financial targets, we believe CIRCOR’s standalone plan is unlikely to generate value comparable to what we are proposing.”

Mitchell continued, “We believe that this business, which has great brands and products, has been meaningfully undermanaged for years.

This has resulted in a persistent decline in CIRCOR’s share price, making it the worst performer of the peers in the S&P Midcap Capital Goods Index since the end of 2013.

Based upon the strength of our disciplined operating approach, Crane Co. is well positioned to integrate CIRCOR’s businesses into our focused portfolio, realize operational synergies, and deliver long-term value to Crane shareholders.

Combining CIRCOR’s Fluid Handling, Aerospace and Defense assets with Crane’s portfolio of leading brands would create a stronger competitor with additional scale and growth potential.”

CIR +13.49 to $44.15.

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HP Enterprise to acquire Cray for $35 per share

HP Enterprise to acquire Cray in deal valued at $1.3B

HP Enterprise to buy Cray Research, Stockwinners

Hewlett Packard Enterprise (HPE) and Cray (CRAY) announced that the companies have entered into a definitive agreement under which HPE will acquire Cray for $35.00 per share in cash, in a transaction valued at approximately $1.3B, net of cash.

Cray Inc. designs, develops, manufactures, markets, and services computing products for high-performance computing, data analytics, and AI markets. It operates through Supercomputing, Storage and Data Management, Maintenance and Support, and Engineering Services and Other segments. 

Cray sold to HPE for $1.3 billion, Stockwinners

“Bringing together HPE and Cray enables an enhanced financial profile for the combined company that includes several revenue growth opportunities and cost synergies.

The companies expect the combination to drive significant revenue growth opportunities by:

Capitalizing on the growing HPC segment of the market and Exascale opportunities; Enhancing HPE’s customer base with a complementary footprint in federal business and academia and the company’s ability to accelerate commercial supercomputing adoption; Introducing new offerings in AI / ML and HPC-as-a-service with HPE GreenLake; We also expect to deliver significant cost synergies through efficiencies and by leveraging proprietary Cray technology, like the Slingshot interconnect, to lower costs and improve product performance.”

As a result of the enhanced financial profiles of the combined companies, the deal is expected to be accretive to HPE non-GAAP operating profit and earnings in the first full year following the close.

As part of the transaction, HPE expects to incur one-time integration costs that will be absorbed within HPE’s FY20 free cash flow outlook of $1.9B-$2.1B that remains unchanged.

The transaction is expected to close by the first quarter of HPE’s fiscal year 2020, subject to regulatory approvals and other customary closing conditions.

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Artesyn Embedded Power sold for $400M

Advanced Energy to acquire Artesyn Embedded Power for $400M

Advanced Energy buys Artesyn Embedded for $400M, Stockwinners

Advanced Energy (AEIS) announced that it has entered into a definitive agreement to acquire the Embedded Power business of Artesyn Embedded Technologies from Platinum Equity.

The total consideration for this transaction will be approximately $400M.

Strategic benefits of the deal include:

“Creates a premier global power conversion company with enabling critical power technologies and over $1.3B in annual revenue, based on 2018 combined historical results.

Strong strategic fit with complementary technologies, product portfolios and core competencies in highly engineered, application-specific power solutions for key OEMs in demanding applications.

Accelerates earnings growth with over $20M of expected annualized synergies, driving projected earnings accretion of over 80c per share in 18-24 months and targeting to reach long-term accretion of over $1.50 per share, on a non-GAAP basis.

Creates significant financial value with a purchase price of approximately 5x synergy-adjusted EBITDA, with a path to future margin expansion, additional cost savings and de-levering to create long-term shareholder value.”

Under the terms of the Share Purchase Agreement, based on a total base purchase price of $400M, Advanced Energy will pay approximately $364M in cash and assume approximately $36M of liabilities for Artesyn EP, subject to final adjustments to the valuation of such liabilities and adjustments to reflect working capital as of the closing.

AE expects to finance the transaction through a combination of existing cash and $350N of debt supported by commitments from its lenders. The transaction has been approved by the board of Advanced Energy.

The transaction, which is expected to close during the second half of 2019, is subject to the satisfaction of customary closing conditions, including receipt of international regulatory approvals and completion of certain carve out activities involving Artesyn’s Embedded Computing and Consumer Products businesses.

AEIS +$4.38 to $52.84.

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Chesapeake Lodging sold for $2.7 billion

Park Hotels & Resorts announces $2.7B acquisition of Chesapeake Lodging

Park Hotels buys Chesapeake Lodging, Stockwinners

Park Hotels & Resorts (PK) and Chesapeake Lodging Trust (CHSP) announced that they have entered into a definitive merger agreement under which Park will acquire all the outstanding shares of Chesapeake in a cash and stock transaction valued at approximately $2.7B.

Upon completion of the merger, the combined company will have an estimated enterprise value of $12B, firmly solidifying Park’s position as the second largest lodging REIT while also advancing the company’s strategic goals of portfolio enhancement and diversification.

The transaction has been approved by the board of directors and board of trustees of Park and Chesapeake, respectively.

Under the terms of the merger agreement, Chesapeake shareholders will receive $11.00 in cash and 0.628 of a share of Park common stock for each Chesapeake share.

The fixed exchange ratio represents an agreed upon price of $31.00 per share of Chesapeake shares of beneficial interest based on Park’s trailing 10-day volume weighted average price as of May 3.

Based on Park’s closing stock price on May 3, this represents $31.71 per share of aggregate value to Chesapeake shareholders and represents a premium of approximately 11% to Chesapeake’s trailing 10-day VWAP and approximately 8% to Chesapeake’s closing stock price on May 3.

Upon closing, Park stockholders and Chesapeake shareholders will own approximately 84% and 16% of the combined company, respectively.

The transaction is subject to customary closing conditions, including receipt of the approval of Chesapeake shareholders.

The companies currently expect the transaction to close in late third quarter or early fourth quarter.

Chesapeake Lodging Trust is a self-advised lodging real estate investment trust (REIT) focused on investments primarily in upper-upscale hotels in major business and convention markets and, on a selective basis, premium select-service hotels in urban settings or unique locations in the United States.

The Trust owns 20 hotels with an aggregate of 6,279 rooms in eight states and the District of Columbia.

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Lord Corporation sold for $3.7 billion

Parker-Hannifin to acquire LORD Corporation for $3.7B in cash

Parker Hannifin to buy Lord Corp., Stockwinners

Parker Hannifin (PH) announced that it has entered into a definitive agreement to acquire LORD Corporation for approximately $3.675B in cash.

The transaction has been approved by the Board of Directors of each company and is subject to customary closing conditions, including receipt of applicable regulatory approvals.

LORD, headquartered in Cary, North Carolina, is a privately-held company founded in 1924 offering a broad array of advanced adhesives, coatings and specialty materials as well as vibration and motion control technologies.

Lord Corp. sold for $3.7 billion in cash, Stockwinners

LORD’s products are used in the aerospace, automotive and industrial markets. LORD has annual sales of approximately $1.1B and employs 3,100 team members across 17 manufacturing and 15 research and development facilities globally.

“This strategic transaction will reinforce our stated objective to invest in attractive margin, growth businesses, such as engineered materials, that accelerate us towards top-quartile financial performance,” said Tom Williams, Chairman and CEO of Parker.

“LORD will significantly expand our materials science capabilities with complementary products, better positioning us to serve customers in growth industries and capitalize on emerging trends such as electrification and lightweighting.

Upon closing of the transaction, LORD will be combined with Parker’s Engineered Materials Group.

Parker plans to finance the transaction using new debt.

Following the completion of the transaction, Parker expects to maintain a high investment grade credit profile.

The transaction is not expected to impact Parker’s dividend payout target averaging approximately 30-35% of net income over a five-year period, while maintaining its record of annual dividend increases.

The transaction is expected to be completed within the next four to six months and is subject to customary closing conditions, including receipt of applicable regulatory approvals.

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Investors unhappy with Bed Bath & Beyond

Investor group outlines strategic plan for Bed Bath & Beyond

Bed Bath & Beyond tumbles on competition. Stockwinners.com

Investor group outlines strategic plan for Bed Bath & Beyond , Stockwinners

Legion Partners Holdings, Macellum Advisors GP and Ancora Advisors released a presentation outlining the Investor Group’s Strategic Plan for Bed Bath & Beyond (BBBY).

The group said, “The plan outlines the path forward to modernizing Bed Bath’s retail practices and delivering a significant earnings per share improvement which could drive $5.00 per share of annual earnings – a level that Bed Bath achieved just a few short years ago.

The Investor Group’s Strategic Plan includes the following highlights: Revamp executive management – recruiting a top-flight CEO to lead Bed Bath going forward and instill a world-class winning culture.

We plan to launch a search in the near term to address this key position. Reverse sales weakness – fixing the merchandise over-assortment problem through a detailed SKU rationalization process as well as developing a merchandise architecture that will better resonate with customers.

Making the in-store experience something that drives traffic to the stores will be a major priority.

Turn around Company culture – increase focus on employee training and education to improve motivation; empower employees to better use technology and improve customer experience.

Significantly expand gross margins – improve vendor relations and drive profits by establishing a direct sourcing strategy and private label program as well as fixing mix issues created by the Company’s shift to commoditized and lower margin products.

Implement cost cutting – conducting an extensive reassessment of the increases in expenses over the last five years, including the explosion of the Company’s advertising budget, seemingly endless array of initiatives that have failed to produce meaningful results and extensive use of consultants.

Improve inventory – increasing inventory turns which would result in a substantial release of cash tied up in slow moving goods. Fix capital allocation – reviewing all non-core businesses and assessing their value as part of the business or their potential value to other parties.

Excess cash created could be applied to share or debt repurchases, both of which are significantly accretive given discounted trading levels.

Lastly, the increase in capital expenditures will be addressed. Above all, the Investor Group’s director nominees have the relevant experience and commitment to execute on these priorities and hold management accountable for delivering results.”

BBBY last traded at $16.68

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Mustang Bio soars on its gene therapy data

NEJM reports ‘medical breakthrough’ in Mustang Bio cell and gene therapy

Mustang Bio (MBIO) announced that the New England Journal of Medicine has published data from St. Jude Children’s Research Hospital, the nation’s “leading hospital” for understanding, treating and curing childhood cancer and other life-threatening diseases.

Mustang Bio soars on its gene therapy data, Stockwinners

The data comes from a Phase 1/2 clinical trial of a lentiviral gene therapy for the treatment of newly diagnosed infants under two years old with XSCID, also referred to as SCID-X1 and commonly known as “bubble boy disease.”

Under a licensing agreement with St. Jude, Mustang will develop the lentiviral gene therapy for commercial use as MB-107.

The multi-center Phase 1/2 clinical trial is evaluating the safety and efficacy of a lentiviral vector to transfer a normal copy of the IL2RG gene to bone marrow stem cells in newly diagnosed infants under the age of two with XSCID, preceded by low exposure-targeted busulfan conditioning.

A total of 10 infants have received the therapy to date in this clinical trial. Among the data highlights, bone marrow harvest, busulfan conditioning and cell infusion were well tolerated.

In seven of the eight cases, normalization of naive T-cell and natural killer cell numbers occurred within three to four months after treatment, accompanied by vector marking in T, B, NK and myeloid cells and marrow progenitors.

All patients cleared previous infections and are growing normally. Seven of the eight infants treated have developed normal IgM levels to date.

Most patients were discharged from the hospital within one month.

Data Highlights:

  • Bone marrow harvest, busulfan conditioning and cell infusion were well tolerated.
  • In seven of the eight cases, normalization of CD3+, CD4+ and CD4+ naïve T-cell and natural killer (“NK”) cell numbers occurred within three to four months after treatment, accompanied by vector marking in T, B, NK and myeloid cells and marrow progenitors.
    • The eighth infant had insufficient T cells initially, but normalization of T cells occurred following an unconditioned boost of gene-corrected cells, and the patient is progressing favorably.
  • All patients cleared previous infections and are growing normally.
  • Seven of the eight infants treated have developed normal IgM levels to date.
    • Four of these seven infants have discontinued monthly infusions of intravenous immunoglobulin (IVIG) therapy to date.
    • Three of those four infants that discontinued monthly IVIG infusions have responded to vaccines to date.

MBIO closed at $2.66, it last traded at $8.91.

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