Notable Mergers and Acquisitions of the Day 10/19: S/IPCS, CME, AGU/TRA/CF

October 19, 2009 10:52 AM EDT

• Sprint Nextel (NYSE: S) to Acquire IPCS, Inc. today announced an agreement for Sprint Nextel to acquire iPCS (NASDAQ: IPCS)for approximately $831 million, including the assumption of $405 million of net debt.
  
  This transaction value represents 6.4x projected 2010 Adjusted Earnings Before Income, Taxes, and Depreciation. Sprint expects to achieve approximately $30 million of synergies annually in the transaction and expects the transaction to be free cash flow accretive to Sprint in 2010.
  
  Under the terms of the agreement, Sprint Nextel will commence a cash tender offer to acquire all of iPCS’ outstanding common shares for $24.00 per share. This price per share represents a 34% premium to iPCS’ closing stock price as of October 16, 2009. The agreement also requires a minimum of a majority of the shares outstanding (on a fully-diluted basis) to be tendered in the offer.
  
  Following completion of the tender offer, any remaining shares of iPCS will be acquired in a cash merger at the same price per share. Shareholders with approximately 9.5 percent of the outstanding common shares of iPCS have already agreed to tender their shares pursuant to the tender offer and to vote their shares in favor of the merger.
  
  As a result, Sprint will no longer be required to divest its iDEN network in certain iPCS territories and will terminate its previously announced divestiture process pending closing of the transaction.
  
  
• CME Group Inc (NASDAQ: CME) is in talks to take over the Chicago Board of Exchange, a Reuters article reports this morning. The deal is valued at up to $5 billion.
  
  Further talks will take place on Wednesday, and the deal would mean a big payout for CBOE members. The deal would value each CBOE seat at about $4 million, or 50% more than they're valued at today.
  
  Click here for the full report.
  
  
• Agrium Inc. (NYSE: AGU) today announced that it has entered into an agreement with Terra Industries Inc. (NYSE: TRA) to sell a portion of Agrium's Carseland nitrogen facility to Terra, conditional on the closing of Agrium's proposed acquisition of CF Industries Holdings, Inc. (NYSE: CF).
  
  Agrium believes this agreement will address regulatory concerns under Canadian competition law in connection with its offer to acquire CF. Agrium also expects to refile its Hart-Scott-Rodino notification shortly with the FTC.
  
  Agrium President and CEO Mike Wilson said, "These actions will enable us to keep moving forward with the acquisition of CF Industries. We believe CF stockholders strongly support our offer, and we will continue to press CF to engage with Agrium. We urge CF to begin meaningful discussions with us concerning our proposed acquisition."
  
  Under the terms of the Carseland transaction, Terra will pay Agrium approximately $250 million in cash for 50 percent of the Carseland facility, or approximately 340,000 tonnes of urea and over 60,000 tonnes of net ammonia on an annual basis and certain U.S. assets. The purchase price for the 50 percent of Carseland is at a similar forward multiple to that which Agrium is offering for CF.
  
  Agrium has also entered into a conditional supply arrangement with Terra for a long-term, competitively priced supply of approximately 175,000 tonnes of nitrogen products from Terra's facilities.
  
  The agreements with Terra are subject to Terra raising $600 million of debt capital and other customary closing conditions.
  
  Agrium has extended the expiration of its offer to acquire CF for $40.00 in cash plus one Agrium share per CF share until 12:00 midnight, New York City time, on November 13, 2009. The Offer is not subject to a financing condition. Agrium has sufficient cash resources and committed financing underwritten by Royal Bank of Canada and The Bank of Nova Scotia to fund the cash portion of the Offer. The Offer is subject to certain conditions described in the offer to exchange.
  
  As of 5:00 p.m., New York City time, on October 16, 2009, approximately 9.1 million common shares of CF had been tendered into and not withdrawn from the exchange offer.

To see all the Mergers & Acquisitions for today in real-time go to http://www.streetinsider.com/Mergers+and+Acquisitions

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