Notable Mergers and Acquisitions of the Day 5/22: JNJ/CGRB, PLA, AMSWA/LGTY
- Johnson & Johnson (NYSE: JNJ) and Cougar Biotechnology, Inc. (Nasdaq: CGRB) announced a definitive agreement whereby Cougar Biotechnology will be acquired for approximately $1.0 billion in a cash tender offer.
Under the terms of the agreement, Johnson & Johnson will initiate a tender offer, through a new wholly-owned subsidiary, to purchase all outstanding shares of Cougar Biotechnology at $43 per share.
Cougar Biotechnology closed at $36.98 yesterday.
Cougar Biotechnology is currently conducting two Phase III trials for abiraterone acetate, a late stage, first-in-class compound for the treatment of prostate cancer.
- The NY Post reported that Playboy Enterprises (NYSE: PLA) is being quietly shopped around for $300 million, which was first reported by Media Ink. However, the highly capitalized private-equity shops like Apollo Capital Partners and Providence Equity Partners have not shown too much interest in PLA.
Just like physical retailers' business models being hurt by the Internet, Playboy's subscription sales have dropped dramatically as once-subscribers of the magazine, now can just view the same material with just a click of the mouse.
Playboy's market capitalization stands around $100 million and no buyer has been willing to pay the substantial premium that it would take to persuade Hugh Hefner to sell the company he founded.
The NY Post said that Playboy is seeking such a high premium so Hef has enough to maintain his lavish lifestyle.
"Everyone says he'll never let go, that he'll take it with him to the grave," said one source.
Hef controls about 70% of the voting stock, and as of March 31, the second-biggest shareholder was Wells Capital, which held a 10% stake. Fidelity is third at 7%.
Playboy has been ferociously trying to cut costs. In its most recent quarter, Playboy lost $13.7 million, compared with a loss of $4.2 million a year ago. Revenue fell to $61.6 million in the quarter from $78.5 million a year ago.
Christie Hefner, Hef's daughter, stepped down as CEO in January and formally left the board at its annual meeting last week, severing her ties.
- American Software, Inc. (Nasdaq: AMSWA) announced today that it is commencing a cash tender offer for all of the outstanding publicly held minority interest in Logility, Inc. (Nasdaq: LGTY) for $7.02 per share in cash. This price represents premiums of approximately 40% and 52% when compared, respectively, to the $5.00 closing price and $4.61 10-day volume weighted average trading price on March 18, 2009, the last trading day prior to the date we announced our intention to make the tender offer.
American Software currently owns approximately an 88% equity interest in Logility. If upon expiration of the tender offer American Software owns 90% of Logility's equity, Logility would become a wholly-owned subsidiary of American Software.
American Software's only interest is in acquiring the shares of Logility held by the minority shareholders and it has no interest in disposing of its controlling interest in Logility. American Software is making its offer to purchase directly to public shareholders to acquire the portion of Logility it does not already own by means of a tender offer. The transaction will be financed with cash on hand.
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