VideoNorth America's merger and acquisition volume nearly doubled last week, led by two purchases of U.S. pharmaceuticals companies — one by a Japanese pharma products maker and one by a UK-based cleaning products concern.
Leading the way in the top 10 deals of the week were the $3.4-billion sale of MGI Pharma Inc. of Bloomington, Minn., to Tokyo-based Eisai Co. Ltd. The second-largest transaction was Reckitt Benckiser Plc's deal to buy Adams Respiratory Therapeutics Inc., of Chester, N.J., for $2.10 billion.
The 57 deals that were struck over the seven-day period totaled $14.67 billion, and raised the year-to-date total for North American M&A past $1.51 trillion, compared with $1.42 trillion in the period ending Dec. 16, 2006, according to data provided to CFO.com by mergermarket .
The results did not include two large deals announced early on Monday — Ingersoll-Rand Co.'s purchase of Trane Inc. and the consolidation of oil-and-gas concerns National Oilwell Varco Inc. and Grand Prideco Inc. — which alone top all of last week's activity. That suggests the possibility of strong year-end strategic dealmaking that could help turn the tide from recent weeks of subpar M&A.
Eisai Co. Ltd. to buy MGI Pharma Inc. for $3.40 billion
MGI Pharma definitively agreed to an acquisition by Eisai, of Tokyo, for $41 a share, a premium of 22.6 percent. MGI, a biopharmaceutical company focused in oncology and acute care, acquires, researches, develops, and commercializes pharmaceutical products. Eisai, which also is engaged in the manufacturing and sale of pharmaceutical products, expect the transaction to significantly strengthen its oncology business and improve its likelihood of meeting revenue and earnings goals. Eisai intends to finance the acquisition through existing internal financial resources and through bank loan financing, and has secured commitment for the debt required to consummate the transaction. The transaction is expected to close in the first quarter of 2008.
Seller financial advisor: Lehman Brothers
Bidder financial advisor: JPMorgan
Seller legal advisor: Hogan & Hartson
Bidder legal advisor: Davis Polk & Wardwell (Advising JPMorgan); and Sullivan & Cromwell
Reckitt Benckiser Plc to buy Adams Respiratory Therapeutics Inc. for $2.10 billion
Adams Respiratory Therapeutics, of Chester, N.J., signed a definitive agreement with Reckitt, of Slough, England, and both boards have recommended the merger for $60 a share, a premium of 37.4 percent. Adams is a specialty pharmaceutical company focused on the late-stage development, commercialization, and marketing of over-the-counter and prescription pharmaceuticals for the treatment of respiratory disorders. Reckitt Benckiser makes and markets branded products in household cleaning and health and personal care, selling through over 60 operating companies into around 180 countries. Reckitt Benckiser will finance the transaction with cash on hand and existing credit facilities. The transaction is expected to close in late January or early February.
Seller financial advisor: Morgan Stanley
Bidder financial advisor: Merrill Lynch
Seller legal advisor: Alston & Bird
Bidder legal advisor: Arnold & Porter
Crown Ltd. to buy Cannery Casino Resorts LLC from Millennium Gaming Inc. and Oaktree Capital Management LP for $1.75 billion
Crown, a Victoria, Australia-based gaming concern, agreed to acquire Las Vegas-based Cannery Casino Resorts (CCR) on a debt-free and cash-free basis. The sellers are Oaktree Capital, a Los Angeles private equity firm, and Millennium, a racetrack and hotel owner and operator based in Lakewood, Colo. Under the agreement, for an acquisition cost of $49.6 million Crown will acquire 58 percent of CCR from Millennium and 42 percent from Oaktree. CCR operates four casinos in Nevada and western Pennsylvania, including the Cannery Hotel and Casino in North Las Vegas, Nevada Palace Casino on the Boulder Strip in East Las Vegas, Rampart Casino in West Las Vegas (operated under a management contract), and The Meadows Racetrack & Casino, a temporary facility in Pittsburgh. CCR is developing two casino/hotel complexes. Crown will fund the acquisition from its existing cash reserves, and expects the acquisition to be immediately accretive to its earnings per share. The acquisition provides Crown entry into the U.S. casino market. It is expected to close within 12 months of signing.
Seller financial advisor: Deutsche Bank
Bidder financial advisor: Macquarie Securities; and Global Leisure Partners
Seller legal advisor: Munger Tolles & Olson
Bidder legal advisor: Skadden Arps Slate Meagher & Flom
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