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Notable Mergers and Acquisitions of the Day 01/22: (JNJ) (OMG) (T)/(ATNI) (BOX)

January 22, 2013 10:25 AM EST Send to a Friend
* Johnson & Johnson (NYSE: JNJ) issued an update on operations and also commented that it is evaluating strategic options for its Ortho Clinical Diagnostics (OCD) business. The company said, "All options will be evaluated to determine the best opportunity to drive future growth and maximize shareholder value. Options include a possible divestiture if it is determined that OCD could have greater potential as part of another organization whose focus is more closely aligned with its core strengths, or by operating as a stand-alone company. At this time it is not certain that any transaction will be consummated."

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* OM Group, Inc. (NYSE: OMG) announced a major step in its strategic evolution with the signing of definitive agreements to exit its Advanced Materials business. The transactions include the sale of the downstream portion of the business, including its cobalt refinery assets in Kokkola, Finland, to a joint venture to be held by Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX), Lundin Mining Corporation and La Generale des Carrieres et des Mines (Gecamines), for total potential consideration of up to $435 million, comprised of initial cash consideration of $325 million and potential future payments of up to an additional $110 million based on the business achieving certain revenue targets over a period of three years. The sale is expected to close before the end of April 2013, subject to customary closing conditions and regulatory approvals. OM Group also announced that its Board of Directors has authorized the repurchase of up to $50 million of its common shares.

The Company said the transactions better position it to achieve its core objectives to:

* Provide specialized, value-added solutions for its customers' complex applications and demanding requirements;
* Expand its leading positions in markets with attractive global growth trends, including automotive systems, electronic devices, aerospace, general industrial and renewable energy;
* Complement its organic growth with synergistic acquisitions; and
* Maximize total shareholder return through financial discipline, optimal deployment of capital, business growth and continued operational excellence.

Following the close of the sale, the Company expects to have total cash on-hand of over $500 million, which it expects to efficiently deploy to repay a substantial portion of its debt, repurchase up to $50 million of its shares, and support its strategy of profitable organic and strategic growth.

In connection with the sale, OM Group will transfer its equity interests in its DRC-based joint venture known as GTL to its joint venture partners, subject to a security interest in favor of OM Group with respect to the joint venture's performance of certain supply arrangements.

* Atlantic Tele-Network, Inc. (Nasdaq: ATNI) agreed to sell its domestic retail wireless business operated under the Alltel name by ATN’s subsidiary Allied Wireless Communications Corporation. AT&T (NYSE: T) will purchase the operations in an all-cash transaction valued at approximately $780 million.

Allied, based in Little Rock, Arkansas, serves approximately 585,000 customers in rural areas of six states – Georgia, North Carolina, South Carolina, Illinois, Ohio and Idaho, and generated revenues for the first nine months of 2012 of approximately $350 million. In ATN’s public filings, these operations are consolidated within its U.S. Wireless segment. These operations generated operating income estimated to be approximately $34 million, which is net of depreciation and amortization expense of approximately $42 million, for the first nine months of 2012.

The transaction is subject to customary closing terms and conditions and regulatory approval from the Department of Justice and the Federal Communications Commission. The companies expect to complete the transaction in the second half of 2013.

Following the close of the sale, Atlantic Tele-Network’s businesses will consist of Commnet, serving rural communities primarily in the Southwest U.S.; Sovernet, serving residential and business customers in New England; ION, serving rural communities in New York State; GT&T, serving Guyana; CellOne, serving Bermuda; and Choice, Islandcom and Mio, serving portions of the Caribbean islands.

* Ontario Teachers' Pension Plan and SeaCube Container Leasing Ltd. (NYSE: BOX), today announced they have entered into an agreement by which Teachers' will acquire 100% of the shares of SeaCube, one of the world's largest container leasing companies.

Under the terms of the agreement, SeaCube shareholders will receive $23.00 in cash per SeaCube common share, representing a 13.3% premium over the shares' closing price on January 18, 2013, a 25% premium over the 50-day volume-weighted average price and a 130% premium over the shares' initial public offering price in October 2010.

The transaction has been unanimously approved by the board of directors of SeaCube, is expected to close in the first half of 2013 and is subject to customary closing conditions, including foreign and U.S. regulatory approvals. In addition, the transaction is subject to approval by the shareholders of SeaCube.

SeaCube is based in Park Ridge, New Jersey, and has seven offices worldwide. It acquires, owns, manages and leases containers that are essential intermodal equipment used in global containerized cargo trade. Equipment is primarily leased under long-term contracts to the world's largest shipping lines.

This transaction is led by Teachers' Long-Term Equities group, which focuses on direct investments with steady cash flow, growth potential over a long-term horizon and a low to moderate level of risk. Teachers' plans to operate SeaCube as a standalone business operation with the current management team remaining in place.

BofA Merrill Lynch and Deutsche Bank Securities Inc. are serving as financial advisors to SeaCube, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to SeaCube.

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