M&A Weekly Recap: Lexmark Buys Brainware, Sweet Deal for Imperial Sugar

Monday

In a statement that implies no better deal in sight, Glencore pronounced its $37 billion takeover of Xstrata “fair” for all shareholders at current levels. Until now, many had hoped for a ‘Plan B’.

El Paso (NYSE:EP) is giving its shareholders the rest of the week to think about their votes on its $23 billion plus acquisition by Kinder Morgan (NYSE:KMI). The meeting was originally scheduled for Monday but was pushed forward to Friday, and although the purchase will probably pass, El Paso is allowing investors the extra days to ponder a judge’s recent criticism of some of the acquisition participants.

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Bottomline Technologies (NASDAQ:EPAY) plans to acquire commercial banking firm Intuit (NASDAQ:INTU) from its financial services segment for $20 million. Bottomline will partner with Intuit in cross promotions and mutual sales efforts targeted towards financial institutions.

Brainware, a developer of scanner software that extracts data from paper and electronic documents, has been purchased by Lexmark (NYSE:LXK) for $148 million in cash. Lexmark’s Perceptive Software unit, which hosts a selection of content-management software products, will be the new location of Brainware.

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Tuesday

In a deal said to be neutral to its fiscal year 2012 earnings, AmerisourceBergen (NYSE:ABC) buys privately-held World Courier Group for $520 million. The acquisition is scheduled to be completed in ABC’s fiscal third quarter and could add $0.06 to $0.10 to earnings per share in fiscal year 2013.

Encore Bancshares (NASDAQ:EBTX) is bought by privately-held Cadence Bancorp for $20.62 a share. The deal is expected to be completed in the second half of this year. Shares of EBTX were halted early Tuesday.

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FRUKT Communications, a music and entertainment agency based in the U.K., is acquired by leading advertising agency Interpublic (NYSE:IPG), and will become part of Interpublic’s Octagon Entertainment division. FRUKT has had such illustrious clients as Coca-Cola and Starwood Hotels.

Goldman Sachs (NYSE:GS) played an advisory role for El Paso (NYSE:EP), when it sold itself to Kinder Morgan for $21 billion, and now second thoughts are leading to a suspicion that the price might have been far too cheap. Andrew Ross Sorkin writes that “Goldman’s brazenness in this deal is nothing short of breathtaking… Other firms have conflicts, but rarely do you hear about them being so incestuous.”

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Thursday

Imperial Sugar (NASDAQ:IPSU) shares jumped after it sold a 50 percent interest in Wholesome Sweeteners to an Arlon Group affiliate. The deal’s price ranges between $55 and $60 million, and depends on Wholesome’s working capital and credit availability when completed.

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Chinese construction gear companies are giving Caterpillar (NYSE:CAT) and other heavy machinery vendors a run for their money, so to speak. Sany, Zoomlion, and XCMG are among the Chinese companies that lead the top 50 of the field, and they comprised about 15 percent of the revenues in 2010 (1.6 percent in 2003). These Chinese companies’ efforts at buying foreign companies for their technology, brands, and distribution networks, is increasing as well.

AT&T (NYSE:T) Yellow Pages are losing more sales than ever to online competitors, some $3.29 billion in 2011, which is down 16 percent. Though the company wants to retain a “substantial minority stake”, it expects to sell its majority stake to private equity firm Cerberus Capital in a deal that would value the business at approximately $1.5 billion. The sale could be closed during this month.

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Friday

Rare metal producer Molycorp’s (NYSE:MCP) acquisition of Neo Material Technologies (NEMFF.PK) is seen by Stifel Nicolaus as a good move, providing vertical activities. However, Stifel keeps its Hold rating, even though it expects the combination to be profitable in 2012.

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Shares rise as Green Dot (NYSE:GDOT) reports that it is acquiring Loopt, which develops mobile apps that allow users to get and share information about local businesses, at a price tag of $43 million. Loopt should help Green Dot to lead the market in mobile payments, it is hoped, by improving sales of its prepaid debit cards. Loopt also holds patents that are relevant in a positive way to mobile marketing, according to Green Dot.

CVR Energy (NYSE:CVI) jumps after Carl Icahn issues an open letter blasting a recent statement made by the company regarding Icahn’s $30 a share tender offer as “disingenuous and misleading.” Icahn says he plans to “conduct a full and open process” to sell CVR if he manages to gain control of the company, but says he will drop his bid if his offer doesn’t leave him with a majority stake by March 23.

El Paso (NYSE:EP) shareholders vote overwhelmingly to approve the company’s sale to Kinder Morgan (NYSE:KMI), despite criticism from some shareholders and a judge about how the deal between the two oil-and-gas pipeline operators was negotiated.

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