Notable Mergers and Acquisitions of the Day 11/11: (C) (YHOO) (ETFC)

• Vivendi and its subsidiary, Universal Music Group (UMG), announced today that they have signed with Citigroup Inc. (NYSE: C) a definitive agreement to purchase EMI’s recorded music division for a total consideration of £1.2 billion representing 7 x EBITDA prior to synergies.
  
  The transaction has been approved both by the Management Board and the Supervisory Board of Vivendi. Closing of the agreement remains subject to a number of conditions, including approvals of regulatory authorities in the countries and continents concerned.
  
  Vivendi will finance the transaction from its existing credit lines. Concurrently, Vivendi and UMG will also sell 500 million euros worth of non-core UMG assets.
  
  Vivendi and UMG have been advised by Allen & Co. and SJ Berwin on this transaction. Citi Global Banking acted as financial advisor to Citi and EMI. Clifford Chance LLP, Shearman & Sterling LLP and Freshfields Bruckhaus Deringer LLP acted as legal advisors to Citi and EMI.
  
  
• Yahoo! (Nasdaq: YHOO) moving following reports that the company may be in talks to sell a significant portion of itself to private equity.
  
  Firms like KKR (NYSE: KKR) and TPG Capital may acquire up to a 20 percent stake in the Internet search giant, rumors suggest. The move may lead to a potential takeover of the whole company, Reuters noted.
  
  KKR and TPG may also team-up with co-founders Jerry Yang and David Filo -- who collectively own 9.5 percent of Yahoo! -- for a potential deal.
  
  In taking a minority stake, the PE firms will position themselves well to take over a larger portion once leverage finance markets open up.
  
  Confidentiality agreements might be signed as early as this morning or afternoon. Another source has said a deal will be announced next week.
  
  Other firms like Blackstone (NYSE: BX), Providence Equity, and Bain Capital have opted against signing a nondisclosure agreement.
  
  The deal might also be structured as a private investment in public equity (PIPE) deal, often used by small- and mid-cap companies which have difficulty raising capital in public markets. PE firms in this deal typically get a more favorable price on equity than the public. With Yahoo!'s market value currently at about $20 billion, it's not entirely clear if this sort of deal could be struck.
  
  Hurdles to the deal include the ability of Yang to turn the company around, shareholder demands and disclosure, and Yahoo! needing to keep its Asian assets. In holding on to Asian assets, Yahoo! might face resistance from Alibaba and others, which have expressed interest in gaining a hold of Yahoo! and might resist a sale to PE firms.
  
  
• E*TRADE Financial (Nasdaq: ETFC) concluded the previously announced review of strategic alternatives.
  
  The strategic review process for the online broker began in July and was designed look over all strategic alternatives for the company, including a possible sale with a primary focus on maximizing stockholder value. Inline with the recommendation from Goldman Sachs (NYSE: GS), the company's financial advisor, the Board unanimously determined that the continued execution of the company's business plan is currently the best alternative for increasing stockholder value.
  
  "Following this review by our Board, the management team will continue to execute on our strategy designed to create value for both our stockholders and our customers," said Steven Freiberg, Chief Executive Officer and Interim Chairman. "We will remain focused on delivering the best investing experience to our customers, strengthening our brokerage business, continuing to improve the performance of our loan portfolio and enhancing our franchise."
  
  Potential bidders for E*TRADE were said to include TD Ameritrade (Nasdaq: AMTD) and Charles Schwab Corp. (Nasdaq: SCHW), among others.

To keep up on all the Mergers & Acquisitions data in real-time, go to our new Mergers and Acquisitions Central page.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Citigroup set to join top banks in Anthropic IPO - Bloomberg
• Robo.ai names Hao Wang of Changer.ae to its board of directors
• S&P 500 may pull back before midterms, but Citi says buy the dip