Notable Mergers and Acquisitions of the Day 07/02: (BMY)/(AMLN) (MU) (IM)/(CELL) (DELL)/(QSFT)


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  • Last Saturday, Amylin Pharmaceuticals, Inc. (Nasdaq: AMLN) agreed to be acquired by Bristol-Myers Squibb Company (NYSE: BMY) for $31.00 per share in cash, or approximately $5.3 billion.

    Including Amylin's net debt and a contractual payment obligation to Eli Lilly & Company (NYSE: LLY), together totaling about $1.7 billion, is approximately $7 billion.

    In March, Amylin rejected a $22 offer from Bristol-Myers and started an auction process. Today's deal comes at a 41 percent premium to the prior offer.

    With the deal, Bristol-Myers Squibb is gaining approved and marketed products for Type 2 Diabetes, including BYETTA and BYDUREON.

    For Bristol-Myers Squibb, the transactions are expected to be dilutive to Non-GAAP earnings per share (EPS) in 2012 and 2013 by approximately $0.03, becoming slightly accretive starting in 2014 with meaningful accretion expected in the later part of the decade.

    Under the terms of the definitive merger agreement, Bristol-Myers Squibb will commence a cash tender offer to purchase all of the outstanding shares of Amylin’s common stock for $31.00 per share. The closing of the tender offer is subject to customary terms and conditions, including the tender of a number of shares that constitutes at least a majority of Amylin’s outstanding shares of common stock, on a fully diluted basis, and expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

    The companies expect the tender offer to close approximately thirty days after commencement of the tender offer.

  • Micron Technology, Inc. (Nasdaq: MU) and Elpida Memory, Inc. signed a definitive sponsor agreement for Micron to acquire and support Elpida. The agreement has been entered into in connection with Elpida's corporate reorganization proceedings conducted under the jurisdiction of the Tokyo District Court.

    Under the agreement, 200 billion Yen (approximately USD $2.5 billion assuming 80 Yen/USD) total consideration, less certain reorganization proceeding expenses, will be used to satisfy the reorganization claims of Elpida's secured and unsecured creditors. Micron will acquire 100 percent of the equity of Elpida for 60 billion Yen (approximately USD $750 million) to be paid in cash at closing. In addition, 140 billion Yen (approximately USD $1.75 billion) in future annual installment payments through 2019 will be paid from cash flow generated from Micron's payment for foundry services provided by Elpida, as a Micron subsidiary. As a result of these payments, all pre-petition debt obligations of Elpida will be fully discharged under the corporate reorganization proceedings. The agreement also calls for Micron to provide certain financing support for Elpida capital expenditures, subject to specified conditions, and to maintain Elpida's operations and employees.

    In a related transaction, Micron also announced today a separate agreement with Powerchip Technology Corporation, a Taiwanese corporation, and certain of its affiliates to acquire the Powerchip group's 24 percent share of Rexchip Electronics Corporation for approximately 10 billion NTD (approximately USD $334 million assuming 30 NTD/USD).

    The transactions are subject to certain conditions, including approval by Elpida creditors, the Tokyo District Court, and other customary antitrust approvals. Elpida's reorganization plan is currently anticipated to be submitted to the Tokyo District Court for approval in August 2012. The transactions are expected to close in the first half of calendar 2013. Micron's purchase of the Powerchip group's Rexchip shares will occur upon close of the Elpida transaction.

    Elpida filed a petition for commencement of Corporate Reorganization Proceedings with the Tokyo District Court under the Corporate Reorganization Act of Japan on Feb. 27, 2012.

  • Ingram Micro Inc. (NYSE: IM), and Brightpoint, Inc. (Nasdaq: CELL) entered into a definitive agreement under which, subject to customary closing conditions, Ingram Micro will acquire all of the outstanding shares of BrightPoint common stock for $9.00 per share in cash, a 66 percent premium to BrightPoint's closing stock price on June 29, 2012, and a 35 percent premium to the 90-day average trading price. The transaction is valued at approximately $840 million, including the value of approximately $190 million of BrightPoint's estimated debt (net of cash), as of June 30, 2012.

    Ingram Micro expects to fund the transaction with existing credit facilities and available cash balances. Ingram Micro has obtained a commitment for a $300 million debt facility to be provided by Morgan Stanley Senior Funding, Inc., which would supplement its existing committed debt capacity. Ingram Micro expects to realize annual cost synergies and efficiencies in excess of $55 million by 2014, and the transaction is expected to be accretive to earnings per share by at least 18 cents in 2013 and 35 cents in 2014, excluding one-time charges and integration costs.

    The following members of BrightPoint's senior management team have committed to senior roles within the new organization after the acquisition is complete: existing Regional Presidents, Mark Howell (Americas), Bruce Thomlinson (APAC) and Anurag Gupta (EMEA), and Vincent Donargo, BrightPoint's Chief Financial Officer. In addition, Robert Laikin will serve in a senior advisory role to Alain Monié.

    The transaction requires approval of a majority of BrightPoint's outstanding shares at a special meeting, which is expected to take place in the 2012 third quarter. Closing of the transaction is also conditioned on customary regulatory approvals. The transaction is expected to close before the end of the year.

    Davis, Polk & Wardwell LLP acted as outside counsel and Morgan Stanley & Co. LLC acted as the exclusive financial advisor to Ingram Micro in connection with the transaction. Blank Rome LLP acted as outside counsel and Blackstone Advisory Partners L.P. acted as the exclusive financial advisor to BrightPoint in connection with the transaction.

  • Dell (Nasdaq: DELL) and Quest Software (Nasdaq: QSFT) entered into a definitive agreement for Dell to acquire Quest, an award-winning IT management software provider offering a broad selection of solutions that solve the most common and most challenging IT problems.

    Dell recently announced the formation of its Software Group to build upon its existing software expertise. The Dell Software Group will add to Dell’s enterprise solutions capability, accelerate strategic growth and further differentiate the company from competitors by increasing its solutions portfolio with Dell-owned intellectual property.

    Under terms of the agreement, approved by the boards of directors of both companies, Dell will pay $28.00 per share in cash for each share of Quest for an aggregate purchase price of approximately $2.4 billion, net of Quest’s cash and debt. The transaction is expected to close in Dell’s third fiscal quarter, subject to approval by Quest’s shareholders and customary conditions.

  • Linde AG agreeed to acquire Lincare Holdings Inc. (Nasdaq: LNCR) for $41.50 per share, or $4.6 billion.

    The Lincare Board of Directors has unanimously approved the transaction. The price of USD 41.50 represents a premium of 64% over Lincare's share price of USD $25.26 on June 26, 2012 (the last day prior to press reports speculating as to Lincare's auction process), and also represents a premium of 49% over the three month volume weighted average price per Lincare share.

    Completion of the offer is subject to customary conditions, including the expiration of the waiting period provided by U.S. antitrust laws and the tender of at least a majority of Lincare's outstanding shares of common stock. Closing is expected for the third quarter of 2012.

  • Murata Electronics North America, Inc. and its parent company Murata Manufacturing Co., Ltd. closed the deal to acquire RF Monolithics, Inc. (hereinafter referred to as “RFM”). The cash transaction paid the holders of RFM common shares $1.78 per share.

    RFM (formerly NASDAQ: RFMI), headquartered in Dallas, Texas, will continue to market its broad range of solutions-driven, technology-enabled wireless connectivity for wireless applications—from individual standardized and custom components to modules for comprehensive industrial wireless sensor networks and machine-to-machine (M2M) technology, under the RFM brand, as a wholly-owned subsidiary of Murata Electronics North America, Inc.

  • PEEK Investments LLC announced a third-party tender offer to purchase all of the outstanding shares of common stock of LookSmart, Ltd. (Nasdaq: LOOK) at $1.00 per share in cash. The offer represents a 35% premium over the NASDAQ Official Closing Price for the common stock on June 28, 2012.

    PEEK is sponsored by a consortium of LookSmart's shareholders represented by Snowy August Management LLC and Platinum Management (NY) LLC. The current consortium may collectively be deemed to be LookSmart's largest shareholder and beneficially own 2,591,312 shares (approximately 14.98% of the outstanding shares).

    PEEK plans to make the tender offer to acquire all shares validly tendered and not withdrawn and provide liquidity at a substantial premium to shareholders who desire to tender while eliminating their further exposure to the downside risk of loss associated with continued ownership of LookSmart's common stock. If the tender offer is consummated and PEEK acquires control of LookSmart, PEEK may utilize control to influence the company's management, policies, and practices in order to effect change, improve performance, and realize value for all shareholders.

    Whether or not the tender offer is consummated, PEEK intends to monitor LookSmart on a continuing basis and hold management and the board accountable for performance, oversight, and the company's compensation and governance policies and practices. PEEK expects LookSmart's officers and directors to demonstrate a conscious regard for their responsibilities and their fiduciary relationship with the owners of the company. If LookSmart's independent directors are unable or unwilling to hold management accountable or otherwise fail to act in the face of clear evidence of a problem or any other duty to act, PEEK may seek to remove some or all of the incumbent directors, during or after the tender offer, whether or not the tender offer is consummated.

    PEEK may seek to add directors to enhance the independence of LookSmart's board and function of its committees. PEEK believes that directors with a more meaningful financial investment of their own in LookSmart may be better positioned and otherwise better able to ensure that an appropriate relationship exists between executive compensation, performance, and the creation of sustainable shareholder value. PEEK may suggest, recommend, propose, or otherwise pursue transactions involving the acquisition, sale, or exchange of all or part of LookSmart's securities or assets or other actions relating to, or potentially resulting in, changes to the company's business, condition, operations, structure, governance, management, capitalization, policies, plans, and prospects and other actions and changes.
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