Notable Mergers and Acquisitions of the Day 06/20: (NWSA) (NJ) (SHO)


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June 20, 2012 10:13 AM EDT Send to a Friend
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  • According to reports Wednesday, News Corp. (Nasdaq: NWSA) is looking to double its investment in Australia's Consolidated Media Holdings to the tune of A$2 billion (about $2 billion), or A$3.50 per share.

    The amount will increase News Corp.'s position in Consolidated Media's Foxtel unit to 50 percent. In addition to the new ownership, News Corp. is also said to plan job cuts at Consolidated Media's newspaper division as it shifts to the more-profitable broadcasting market.

    Current 50 percent owner of Consolidated Media, James Packer, is backing the deal. Packer inherited the stake following his father's death in 2005 and is looking to cut ties with the media company in order to focus on his casino business.

    Closing date on submissions is set for July 11th, with the Australian Competition & Consumer Commission expected to release findings by August 2nd.

    Foxtel broadcasts the most popular games in the Australian Football League as well as the National Rugby League.

  • Nidec Corporation (NYSE: NJ) has agreed to acquire shares in Jiangsu Kaiyu Auto Appliance Co., Ltd., a Chinese company, to be privately issued to the Company in a capital increase transaction, and entered into an agreement for the Transaction with Jiangsu Luokai Mechanical and Electrical Manufacturing Group Co., Ltd. and the other shareholders of Kaiyu. Immediately following the Transaction, the Company is expected to hold a 51% ownership interest in Kaiyu.

    The Company has sought to expand its automotive motor business as one of its pillar businesses not only through organic growth but also by actively pursuing opportunities to acquire companies in the industry.

    Kaiyu sells its products to Chinese automobile manufacturers and has a strong presence in the Chinese market, which is expected to expand and grow, as a manufacturer of brush motors for electric power steering ("EPS") systems. Through the Transaction, the Company seeks to acquire technologies for brush motors for EPS systems, which the Company currently does not possess, and business opportunities in the Chinese automobile market, new entry into which has been difficult.

    In addition, the Company and Kaiyu will aim to expand sales of brush motors for EPS systems to non-Chinese automobile manufacturers and to emerging economies outside China by mutually taking advantage of each other's research and development capabilities, manufacturing facilities and sales channels.

  • After the market closed Tuesday, Sunstone Hotel Investors, Inc. (NYSE: SHO) announced it entered into a purchase and sale agreement to acquire the fee-simple interest in the 357-room Hilton Garden Inn Chicago Downtown/Magnificent Mile for a gross purchase price of $91.75 million ($257,000/key).

    The purchase price represents an 11.7x multiple on 2012 forecasted hotel Adjusted EBITDA of $7.8 million and a 7.7% capitalization rate on 2012 forecasted hotel net operating income. During the Company's anticipated 2012 ownership period, the Hotel is expected to generate approximately $4.1 million of EBITDA and $3.7 million of net operating income.
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