Notable Mergers and Acquisitions of the Day 05/14: (GOLF) (PETD) (CXO) (TIII) (NCT)


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May 14, 2012 10:52 AM EDT Send to a Friend
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  • Golf Town and Golfsmith International Holdings, Inc. (Nasdaq: GOLF), signed a definitive merger agreement, pursuant to which Golf Town will acquire Golfsmith, a leading specialty golf retailer in the United States, for US $6.10 per share in cash.

    The closing of the acquisition, which is subject to limited closing conditions, including regulatory approvals, is expected to occur in the third quarter of 2012. The transaction is not subject to a financing condition.

    Golf Town is owned by OMERS Private Equity and operates 54 stores across Canada and 7 stores in the greater Boston area. Golfsmith has been in business for over 40 years and is a speciality retailer of golf equipment and related apparel and accessories.

    The transaction will result in the creation of the world's largest specialty golf retailer.

  • Petroleum Development Corporation (Nasdaq: PETD) has executed a definitive agreement to acquire Core Wattenberg assets that contain significant liquid-rich horizontal drilling opportunities from a private party for a purchase price of approximately $330.6 million, subject to customary terms and adjustments. The effective date of the transaction is April 1, 2012 with closing currently scheduled for June 29, 2012, subject to customary closing conditions.

  • Concho Resources Inc. (NYSE: CXO) has entered into a definitive agreement to acquire all the oil and natural gas assets of Three Rivers Operating Company and certain affiliated entities for $1.0 billion in cash. Three Rivers is a privately-held exploration and production company with approximately 310,000 gross (200,000 net) acres in the Permian Basin, including large positions in the Company’s core northern Delaware Basin play, the Midland Basin Wolfberry play, and the emerging southern Midland Basin horizontal Wolfcamp and Cline shale plays.

    J.P. Morgan acted as the Company’s lead financial advisor, BMO Capital Markets acted as a financial advisor and Vinson & Elkins LLP represented the Company in connection with the transaction.

    The acquisition is expected to close in July 2012, subject to regulatory approval and other customary closing conditions, and is subject to certain preferential rights to purchase and other customary purchase price adjustments.

  • Tii Network Technologies, Inc. (Nasdaq: TIII), has entered into a definitive merger agreement with Kelta, Inc., a Delaware corporation, pursuant to which Kelta will acquire Tii Network Technologies for $2.15 a share, or total consideration of approximately $33.1 million. The merger consideration represents an approximately 48% percent premium over the closing price of Tii Network Technologies' common stock as quoted on the website of the NASDAQ Stock Market on May 11, 2012.

    The acquisition, which was unanimously approved by the Board of Directors of Tii Network Technologies, is subject to approval by its stockholders, as well as other customary closing conditions. The Company expects the transaction to close in the third quarter of 2012. The acquisition is not subject to any financing condition. Kelta intends to fund the acquisition with a combination of existing cash and funds available under Kelta's current credit facilities.

    OEM Capital Corp. has provided a fairness opinion in connection with the transaction to the Board of Directors of Tii Network Technologies. Troutman Sanders LLP is serving as legal advisor to Tii Network Technologies in connection with this transaction. Edwards Wildman Palmer LLP is serving as legal advisor to Kelta in connection with the transaction.

  • Newcastle Investment Corp. (NYSE: NCT) signed a definitive agreement to acquire up to a 65% interest in excess mortgage servicing rights from Nationstar Mortgage LLC in connection with Nationstar’s acquisition of certain residential mortgage servicing rights and other assets (collectively, the “Mortgage Servicing Assets”) from Residential Capital, LLC and related entities (collectively, “ResCap”) in connection with ResCap’s proposed sale of these assets pursuant to an auction supervised under the U.S. Bankruptcy Code (the “Transaction”).

    Newcastle expects to invest between $150 million to $300 million to acquire an interest in Excess MSRs related to Nationstar’s proposed acquisition of primary mortgage servicing rights with an unpaid principal balance of approximately $201 billion as of February 29, 2012. (Newcastle has committed to invest up to $450 million to acquire a 65% interest in these Excess MSRs, but it has retained the flexibility to sell a portion of its commitment to certain Fortress affiliates.) Nationstar will be the servicer of the loans and will invest alongside Newcastle by retaining an approximately 35% interest in the Excess MSRs. Approximately 65% of loans associated with the primary mortgage servicing rights (by unpaid principal balance) are owned, insured or guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae.

    Under the terms of this proposed investment, to the extent that any loans in this portfolio are refinanced by Nationstar, the resulting primary mortgage servicing right will be included in the portfolio, subject to certain limitations. This should serve to significantly reduce the impact of prepayments on Newcastle’s investment. Newcastle will not have any servicing duties, advance obligations or liabilities associated with the portfolio.
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