M&A Weekly Recap: Cisco Buys Clear Access, RIM Might Be Ready For Suitors

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Monday

The divestiture of hand and power tool maker Apex Tool Group could bring a price as high as $1.5 billion for Danaher (NYSE:DHR) and Cooper Industries (NYSE:CBE), who own it jointly. Sources report that the companies are currently planning to sell Apex.

In a deal in which the price is not reported, Avnet (NYSE:AVT) buys Ascendant Technology, which is a worldwide information technology consulting firm that posted revenues of $90 million last year. Avnet, a chip and IT hardware distributor, will offer Ascendant’s specialty IBM software services to its hardware services customers.

Private equity firm HIG Capital purchases Comverge (NASDAQ:COMV) at $1.75 per share, which is somewhat below the closing price of $1.88 Friday. The total amount tendered of approximately $49 million was less than observers’ valuations of its worth, but Comverge didn’t resist the takeover, explaining that it “would be unable to raise the necessary capital to fund continuing operations, which would place existing stockholder investment in the company at significant risk.”

Wireless and aerospace/defense equipment components maker Anaren (NASDAQ:ANEN) might be on the shopping list of competitor API Technologies (ATNY), according to DealReporter, and shares duly jump. There is a potential problem, however: Anaren has a market cap of $264 million, but API’s is only $196 million.

Tuesday

United Technologies’ (NYSE:UTX) may be ‘confident’ that its $16.5 billion buyout deal for of Goodrich (NYSE:GR) will close by mid-year, but the European Commission is now looking into whether the proposed arrangement might prove anti-competitive in the markets for engine controls and AC power generators.

In a move that Wabash National (NYSE:WNC) says would immediately accrue to earnings, the semi-trailer maker acquires privately-held Walker Group Holdings for $360 million in cash. Walker produces liquid-transportation systems and engineered products, which Wabash says will diversify its business.

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Pushing back at its larger rival Priceline (NASDAQ:PCLN), Expedia (NASDAQ:EXPE) gets into the game of expanding market shares in Europe by agreeing to purchase the Scandinavian corporate travel management company VIA Travel, at an undisclosed amount. The move is seen as Expedia’s attempt to stem Priceline’s increasing penetration into the Continent.

In a deal that almost certainly involves Apple (NASDAQ:AAPL), Sharp (SHCAY.PK) will sell a 9.9 percent stake to contract manufacturing major Foxconn (HNHAF.PK) for $1.6 billion at an 11 percent premium to Tuesday’s close. Additionally, Sharp is selling a 46.5 percent stake in its display unit to Foxconn’s founder. The Apple connection: its largest contract manufacturer is Foxconn, and one of its display suppliers is Sharp, which is also thought to be the manufacturer of the iTV.

Wednesday

ClearAccess is acquired by Cisco (NASDAQ:CSCO), and the fallout might be impacting shares of Synchronoss (NASDAQ:SNCR) as well. Clearaccess develops software that allows service providers to manage and provision broadband modems and set-top boxes, and Cisco expects to meld those products with its Prime network management software. Exactly how Synchronoss is affected by this is uncertain, however, as its provisioning software is largely used for mobile devices.

EMI’s recorded music operations are being acquired by Vivendi’s (VIVHY.PK) Universal Music, and its publishing unit by Blackstone (NYSE:BX), for $1.9 billion and $2.2 billion respectively. However, the FTC and the EU are investigating the proposed transactions, and now California Attorney General Kamala Harris has joined the inquiry as well.

Mitsubishi buys a 25 percent investment in a platinum and copper venture in Canada of Stillwater Mining (NYSE:SWC). The stake costs Mitsubishi $81.2 million, and the deal provides a clause in which the company can buy all 100 percent of production under a related supply agreement.

Here is more on the Carl Icahn vs. CVR Energy (NYSE:CVI) saga: CVR on Wednesday advised its shareholders to ignore Icanh’s tender offer, and he shot back that his interest in the company (presumably alone) has prodded shares to increase over the $3.25 rise that investors had seen over the past four years. Mr. Icahn also asked, out loud, why CVR’s chairman of the board is selling his shares, if it’s true that a $30 per share bid undervalues the company?

Thursday

The Roche (RHHBY) – Illumina (NASDAQ:ILMN) takeover drama sharpens Thursday as the former raises its hostile offer to the latter’s shareholders by 15 percent to $51 a share, or approximately $6.7 billion, but so far the investors see the offer as ‘lowball’. Baillie Gifford, Illumina’s second largest shareholder with 11 percent, is especially opposed to the deal. Further, Illumina shares closed Wednesday more than $5 higher than Roche’s initial bid of $44.50. According to inside sources, Roche could raise its bid higher if Illumina would agree to talks with its would-be buyer.

India’s largest beer company, United Breweries, could become Heineken’s (HINKY) if that company purchases another 13 percent, for $370 million. United’s owner, Vijay Mallya is seeking capital in order to keep Kingfisher Airlines a going concern, so the possibility of such a deal exists.

Collective Brands (NYSE:PSS), which owns shoe stores Payless and Stride Rite, is on the shopping list of South Korean retailer E-land, according to a business newspaper in that country, and shares respond positively in early trading. E-land is reportedly nearing an offer of $1.8 billion for Collective, which announced last summer its intentions to shut under-performing stores and perform a strategic evaluation.

Two pharmacy groups and nine retail pharmacy companies are filing a lawsuit in Federal court to block the ongoing merger of Express Scripts (NYSE:ERX) and Medco (NYSE:MHS). The drug majors expect their $29.1 billion deal to close nest week, however, and an expert in such cases says that if the government allows the merger, the lawsuit will face quite an uphill battle.

A sale of KIT Digital (NASDAQ:KITD) may well be “underway”, says Roth Capital analyst Richard Ingrassia, who has investigated the situation with sources and executives. A list of possible suitors includes IBM, Cisco, Accenture, and Alcatel-Lucent, plus a slew of private equity firms.

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Friday

Smartphone maker Research In Motion (NASDAQ:RIMM) might be near giving it all up and allowing itself to be acquired, and The Wall Street Journal is reported to be making a list of likely suitors among the many companies that are said to be interested.

Hynix (HXSCF.PK) has submitted preliminary interest in acquiring bankrupt Japanese chipmaker Elpida. The South Korean chipmaker had up until now denied its interest in Elpida.

Another big day for IPTV software company KIT Digital (NASDAQ:KITD) shares, which jumped Thursday on merger and acquisition speculation. Chatter about a potential deal centers on KIT’s poor share performance over the last months, and the fact that its board and management have been recently recast.

Word that Liz Claiborne (NYSE:LIZ) is meeting with private equity firms about the possibility of getting as much as $20 per share from a buyer, is causing its stock to pop on Friday.

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To contact the reporter on this story: Mark Lawson at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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