Notable Mergers and Acquisitions of the Day 12/15: MGM, HUN, FNF/LFG, ISBC/ABNJ
- MGM MIRAGE (NYSE: MGM) and Ruffin Acquisition, LLC today announced that they have entered into an agreement whereby MGM MIRAGE, through its wholly-owned subsidiary The Mirage Casino-Hotel, will sell Treasure Island Hotel & Casino to Ruffin Acquisition, LLC for $775 million. Ruffin Acquisition, LLC is wholly owned by Phil Ruffin.
The purchase price is to be paid at closing as follows: $500 million in cash and $275 million in secured notes bearing interest at 10%, with $100 million payable not later than 175 days after closing and $175 million payable not later than 24 months after closing. The notes, to be issued by Ruffin Acquisition, LLC, will be secured by the assets of TI and will be senior to any other financing.
The parties expect the transaction to close by the end of Q209. MGM MIRAGE expects to report a substantial gain on the sale.
- Huntsman Corporation (NYSE: HUN) has terminated its Merger Agreement with Hexion Specialty Chemicals, Inc.. In addition, Huntsman announced that it reached an agreement with Hexion, Apollo Management, L.P. and certain of its affiliates to settle Huntsman's claims against Hexion, Apollo and its affiliates arising in connection with Huntsman's Merger Agreement with Hexion. Payments to be made to Huntsman under the Settlement Agreement total $1 billion.
In addition to the $325 million break-up fee to be paid as provided in the Merger Agreement and which Hexion expects will be funded by Credit Suisse and Deutsche Bank under an existing commitment, certain affiliates of Apollo will make cash payments to Huntsman under the Settlement Agreement totalling $425 million. Certain affiliates of Apollo also will pay Huntsman an additional $250 million in exchange for 10 year convertible notes issued by Huntsman in that principal amount, which may be repaid at maturity in cash or common stock at Huntsman's election.
- Fidelity National Financial, Inc. (NYSE: FNF) Friday announced the signing of an amended stock purchase agreement with LandAmerica Financial Group, Inc. (NYSE: LFG) pursuant to which FNF will acquire LFG's two principal title insurance underwriters, Commonwealth Land Title Insurance Company and Lawyers Title Insurance Corporation, as well as United Capital Title Insurance Company.
The total purchase price for Commonwealth and Lawyers is approximately $282 million. Chicago Title Insurance Company and Fidelity National Title Insurance Company will pay a total of approximately $135 million in cash to LFG. Additionally, FNF will pay LFG a total consideration of approximately $147 million consisting of $47 million in cash, a $50 million subordinated note due in 2013, with interest at the 5-year treasury rate at closing plus 1 percent and approximately $50 million in FNF common stock valued at no less than $14.00 per share. The agreement also calls for Fidelity National Title's cash purchase of United for statutory book value at closing. United's statutory book value was approximately $16 million as of September 30, 2008
- Investors Bancorp, Inc. (NASDAQ: ISBC) and American Bancorp of New Jersey, Inc. (NASDAQ: ABNJ) jointly announced the signing of a definitive agreement under which Investors Bancorp will acquire American Bancorp of New Jersey for $140 million in stock and cash, or $12.50 per share.
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