Notable Mergers and Acquisitions of the Day 08/25: (BRK-A)/(BAC) (RLRN) (ACIW)/(SONE) (BAX)

• Bank of America Corporation (NYSE: BAC)announced today that it reached an agreement to sell 50,000 shares of Cumulative Perpetual Preferred Stock with a liquidation value of $100,000 per share to Berkshire Hathaway, Inc. (NYSE: BRK-A) in a private offering. The preferred stock has a dividend of 6 percent per annum, payable in equal quarterly installments, and is redeemable by the company at any time at a 5 percent premium.
  
  In conjunction with this agreement, Berkshire Hathaway will also receive warrants to purchase 700,000,000 shares of Bank of America common stock at an exercise price of $7.142857 per share. The warrants may be exercised in whole or in part at any time, and from time to time, during the 10-year period following the closing date of the transaction. The aggregate purchase price to be received by Bank of America for the preferred stock and warrants is $5 billion in cash.
  
  
• Renaissance Learning, Inc. (Nasdaq: RLRN) received an unsolicited, non-binding proposal from Plato Learning, Inc.
  
  The proposal contemplates the acquisition of Renaissance Learning by Plato Learning for $15.50 per share in cash.
  
  The proposal also states that it is subject to completion of due diligence and that the transaction is expected to be financed with equity from Thoma Bravo, HarbourVest Partners and JP Morgan as well as with debt.
  
  The Board of Directors continues to recommend that shareholders vote in favor of adopting and approving the merger agreement and the transactions contemplated thereby with affiliates of the Permira Funds, pursuant to which Renaissance Learning would be acquired for $14.85 per share in cash.
  
  
• ACI Worldwide, Inc. (Nasdaq: ACIW), has increased its cash and stock proposal to acquire S1 Corporation (Nasdaq: SONE) from $5.70 per share plus 0.1064 ACI shares, to $6.20 per share plus 0.1064 ACI shares, assuming full proration. Based on ACI's closing stock price on July 25, 2011, the last trading day prior to the public announcement of the ACI proposal, the ACI enhanced proposal has a blended value of $10.00 per share, and based on the closing price of ACI on August 24, 2011, the ACI enhanced proposal has a blended value of $9.29 per share.
  
  
• Baxter International Inc. (NYSE: BAX) announced today that it has entered into a definitive agreement to acquire Baxa Corp.
  
  Baxa is a privately held company based in Englewood, CO, which develops pharmacy technology that enhances the efficiency and safety of oral and IV dose preparation and delivery.
  
  The transaction includes a total upfront cash consideration of $380 million and is expected to close following satisfaction of customary closing conditions and the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act. Annual sales for Baxa were approximately $150 million in 2010, and Baxter expects the future top-line growth of this business to be accretive to the company’s future sales growth. In addition, Baxter expects this transaction to be neutral to full-year 2012 earnings excluding dilution of approximately $0.03 to $0.05 per diluted share related to acquisition accounting and transaction-related expenses, and increasingly accretive thereafter.
  
  
• Compass Diversified Holdings (NYSE: CODI) has acquired a controlling interest in CamelBak Products, LLC on August 24, 2011.
  
  The purchase price of $257.5 million for the membership interests of CamelBak is based on a total enterprise value of $245.0 million and included $12.5 million of cash and working capital adjustments. The acquisition was consummated through a majority-owned subsidiary, CamelBak Acquisition Corp. This structure will allow CODI to amortize a substantial portion of the purchase price for tax purposes. CODI funded the acquisition through drawings on its Revolving Credit Facility, as well as through funds provided by a private placement of 1.575 million of its common shares at the closing market price of $12.50 per share on August 23, 2011, to CGI Magyar Holdings LLC, its largest shareholder. An affiliate of CMH also purchased $45.0 million of convertible preferred stock in CamelBak Acquisition Corp. Acquisition related costs were approximately $4.2 million.
  
  CODI's initial common equity ownership in CamelBak Acquisition Corp. is approximately 89.9%.

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