Notable Mergers and Acquisitions of the Day 8/3: HEP/HOC, PSEC/PCAP, GRB

August 3, 2009 10:09 AM EDT

• Holly Energy Partners, L.P. (NYSE: HEP) and Holly Corporation (NYSE: HOC) announced the August 1, 2009 acquisition by Holly Energy from Holly of certain truck and rail loading/unloading facilities located at Holly's Tulsa, Oklahoma refinery.
  
  The purchase price for these facilities was $17.5 million which was paid in cash. The acquisition was financed through Holly Energy's revolving credit facility. Holly Energy expects this acquisition will result in approximately $2.7 million of incremental annual revenue.
  
  In connection with this transaction, Holly and Holly Energy have entered into a 15-year Equipment and Throughput Agreement. Holly will pay Holly Energy a per barrel fee for each barrel loaded or unloaded at the facilities.
  
  
• Prospect Capital Corporation (NASDAQ: PSEC) announced that it has entered into a definitive agreement to acquire Patriot Capital Funding, Inc. (NASDAQ: PCAP).
  
  Prospect is acquiring Patriot for $197 million, comprised of (a) cash to repay all Patriot debt, anticipated to be $110.5 million when the acquisition closes, plus (b) Prospect shares exchanged at a ratio of approximately 0.3992 Prospect shares for each Patriot share, or 8,616,467 Prospect shares for 21,584,251 Patriot shares, with such exchange ratio decreased by any tax distributions Patriot may declare before closing.
  
  The acquisition, unanimously approved by both of Prospect's and Patriot's Board of Directors, is expected to close in the next 60 days. The acquisition is subject to Patriot stockholder approval and other customary closing conditions. Patriot's shareholders will own 15% of Prospect's outstanding shares pro forma for the acquisition, so Prospect shareholder approval is not required.
  
  
• Gerber Scientific, Inc. (NYSE: GRB) announced that it had entered into an agreement to sell its laser marking and engraving business unit, FOBA Technology + Services GmbH, to ALLTEC Angewandte Laserlicht Technologie GmbH, the laser business unit of Videojet Technologies Inc. In accordance with the agreement, consummation of the transaction is subject to customary terms and conditions and regulatory approvals, including approval of the German merger control authority, which the Company expects will take no longer than a month. While financial terms of the transaction were not disclosed, the Company said that the proceeds from the sale would be used to reduce its outstanding debt and for general corporate purposes. RA Capital Advisors acted as financial advisor to the Company in the transaction.

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