Notable Mergers and Acquisitions of the Day 08/10: (JNS) (VIT)/(HSFT) (CUUU)/(CMSB)
- Facebook (FB) Set to Join the S&P 100 & 500; Alliance Data Systems (ADS) and Mohawk (MHK) to Join the S&P 500; Changes to the S&P MidCap 400 and the S&P SmallCap 600
- Market Wrap: Facebook is Movin' Up; Strong Start for IPO Autohome; Costco Slumps on Sales
- After Hours Stock Movers 12/11: (UNS) (PRTA) (FB) Higher; (IMUC) (ATHN) (SUNE) Lower (more...)
- William Blair's 2014 Top Midcap Picks
- Fortis to Acquire UNS Energy (UNS) for $60.25/Share
- Janus Capital Group Inc. (NYSE: JNS) entered into a strategic alliance with The Dai-ichi Life Insurance Company, Limited, the third largest life insurer in Japan. In connection with this transaction, Dai-ichi Life plans to acquire at least 15%, and no more than 20%, of JCG’s outstanding common shares through open market purchases and potentially through the exercise of conditional options issued to Dai-ichi Life by JCG.
As part of this alliance, Dai-ichi Life will support JCG’s distribution initiatives in Japan and plans to invest USD$2 billion of its general account assets with JCG, including seed capital for JCG investment strategies. Following Dai-ichi Life’s accumulation of at least 15% of JCG’s common shares outstanding, it is expected that an individual designated by Dai-ichi Life will be appointed to JCG’s Board of Directors.
As part of the agreement, JCG sold Dai-ichi Life a series of conditional options to purchase, in aggregate, up to 14,000,000 shares of JCG’s common stock. In the event that all or a portion of the conditional options are exercised, JCG intends to use the proceeds to repurchase JCG common shares to offset resulting dilution. The repurchase of common shares will be at JCG’s discretion, subject to market and business conditions.
- VanceInfo Technologies Inc. (NYSE: VIT)) and hiSoft Technology International Limited (Nasdaq: HSFT) have signed a definitive merger agreement, under which the companies will be combined in a tax-free, all-stock merger of equals with a combined equity value of approximately US$875 million. Under the terms of the agreement, VanceInfo and hiSoft shareholders will each own approximately 50% of the combined company. hiSoft will be the surviving listed company in the merger, and its shares will continue to be listed on the NASDAQ Global Select Market. A new name for the combined company will be announced in due course.
Under the agreement, each outstanding ordinary share of VanceInfo will be exchanged for the right to receive one common share of hiSoft, and each American Depositary Share of VanceInfo ("VanceInfo ADS"), each of which represents one VanceInfo ordinary share, will be exchanged for the right to receive one American Depositary Share of hiSoft ("hiSoft ADS"). Immediately prior to the merger, hiSoft will effect a 13.9482-to-1 share consolidation and change the ratio of hiSoft ADSs representing ordinary shares from one ADS for 19 shares to one ADS for one share, which effectively implies in a 1-to-1.3622 hiSoft ADS split. These changes are designed to ensure that hiSoft and VanceInfo will have the same number of outstanding shares and ADSs at the effective time of the merger.
The combined company will employ over 23,000 people across 13 locations in China and 14 additional locations worldwide. It will serve a global base of top tier customers, which include some of the largest Chinese corporations as well as many Fortune 500 companies. Its vertical areas of strength will include TMT, BFSI, Transport and Manufacturing.
The companies have identified potential cost synergies, which are expected to reach 2% of combined revenues within 18 months after the closing of the transaction. The parties are developing a defined execution plan and anticipate that the transaction will be accretive within the first 12 months following the consummation of the merger.
The strategic combination has been approved by both companies' boards of directors and is subject to customary closing conditions, including shareholder approvals by VanceInfo and hiSoft shareholders. The transaction is expected to close in the fourth quarter of 2012.
CitigroupGlobal Markets Inc. acted as financial advisor and Orrick, Herrington & Sutcliffe LLP acted as legal counsel to VanceInfo in connection with this transaction. Lazard acted as financial advisor and Simpson Thacher & Bartlett acted as legal counsel to hiSoft in connection with the transaction.
- Customers Bancorp Inc. (OTCBB: CUUU), and CMS Bancorp, Inc. (Nasdaq: CMSB), jointly announced their execution of a definitive Agreement and Plan of Merger.
Under the Agreement, Customers Bancorp will acquire via merger CMS Bancorp and ultimately CMS Bank. CMS Bank is a community and customer-oriented bank, offering services to consumers and small businesses in Westchester County, New York, and the surrounding areas.
Upon closing of the transactions, Customers Bancorp will have retail banking offices located in the communities of Eastchester, Greenburgh, Mount Vernon, West Harrison, and Mount Kisco, in Westchester County, New York, as well as approximately $185 million in loans and $208 million in deposits. The CMS Bancorp acquisition is expected to be mildly accretive to Customers Bancorp's capital, earnings and book value per share within the first six months after closing. The total transaction value is approximately $20.8 million, and the Agreement provides for CMS Bancorp stockholders to receive shares of Customers Bancorp voting common stock based upon an exchange ratio determined at the closing of the transaction, with fractional shares to be cashed out.
CMS Bancorp stock will be valued at 95% of CMS Bancorp's common stockholders' equity as of the month end prior to the closing, while Customers Bancorp stock will be valued at 125% of Customer Bancorp's modified stockholder equity as of the month end prior to closing. Modified stockholders' equity is defined as June 30, 2012 book value plus additions to retained earnings through the month-end prior to closing. Shares issued by Customers Bancorp in capital raises and purchase accounting adjustments from any other acquisitions will not be included in calculating modified stockholders' equity.
Based on the March 31, 2012 book value per share of CMS Bancorp and the June 30, 2012 modified stockholders' equity of Customers Bancorp of $11.75 and $13.99, respectively, the exchange ratio would be 0.6383. The actual exchange ratio will likely be different at closing.
Closing of the CMS Bancorp merger, which is subject to regulatory approval, customary closing conditions and the approval of CMS Bancorp's stockholders, is expected to occur in the first half of 2013. In mid-June 2012, Customers Bancorp announced an accretive to capital, book value and earnings transaction to acquire Acacia Savings Bank from Ameritas Mutual Companies for $65 million in Customers Bancorp common and preferred stock. That transaction will add the one branch of Acacia to the Customers Bank franchise and also comes with a regional mortgage banking operation. "We intend to complete our approval process for Acacia, close it and then close the CMS transaction," stated Sidhu. "After closing the CMS transaction, we hope to gradually continue expanding in the New York market, however, principally through organic growth," Sidhu concluded.
For these transactions, Customers Bancorp retained Stradley Ronon Stevens & Young, LLP as legal advisor. CMS Bancorp was advised by Sandler O\'Neill+ Partners, L.P. as financial advisor and Paul Hastings LLP as legal advisor.
You May Also Be Interested In
- ProfNet Experts Available on New Year's Resolutions, Nelson Mandela, More
- Notable Mergers and Acquisitions of the Day 12/11: (STI) (JDSU) (LSTR) (SVNT)
- FBR Capital Starts Halliburton (HAL) at Market Perform
Create E-mail Alert Related CategoriesSpecial Reports
Related EntitiesLazard, Janus Capital, Notable Mergers and Acquisitions, Earnings
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!