The Special Situation Report #12: 4/10 Roundup

Summary of the Week in Special Situations

Apr 10, 2022

Thanks for checking out the latest roundup. In my next article, I will cover several attractive companies trading at reasonable valuations, in an industry with secular growth tailwinds, and an emerging consolidation trend. If you are subscribed, it will hit your inbox the morning of Thursday, April 14th. I hope to see you again next week; same time, same place.

Update on Developing M&A

Strategic Alternatives & Ongoing Situations

Everbridge (EVBG) activist investor Ancora says multiple firms are interested in potential acquisition (Press Release)
Kaleido Biosciences (KLDO) announced a process to explore strategic alternatives (10-K)
Kohl’s (KSS) activist investor Macellum asked for more transparency in the sale process (Filing)
LXP Industrial Trust (LXP) suspended its review of strategic alternatives and will stay independent for now (Press Release)
Mace Security International (MACE) announced a review of strategic alternatives after receiving inbound interest (Press Release)
Nielsen (NLSN) holder WindAcre will attempt to block Nielsen’s sale to PE & asked for $1bn in equity to support the takeover (Bloomberg); WindAcre subsequently raised its ownership to 19% (Filing)
Spirit Airlines (SAVE) to enter talks with JetBlue (JBLU) after JetBlue’s unsolicited offer trumped an earlier announced takeover bid by Frontier (ULCC) (Reuters)
Ted Baker (LSE: TED) launched a formal sale process after receiving an improved offer from Sycamore and other unsolicited third party bid interest (Press Release)
Toshiba (TOSYY) announced the formation a of a special committee to assess takeover bids (Financial Times)
Turquoise Hill (TRQ) formed a special committee and retained advisors to review Rio Tinto’s (RIO) takeover proposal (Press Release)

Rumors

Argo Group (ARGO) seeks a new advisor to reboot sales process (The Insurer)
Black Knight (BKI) is reportedly exploring a potential sale after receiving takeover interest (Yahoo)
Cyxtera Technologies (CYXT) gained on a report that it’s exploring a sale transaction (Bloomberg)
Envestnet (ENV) is reportedly close to a sale, with Warburg Pincus and Advent in the hunt (Axios)
Maravai LifeSciences (MRVI) gained on a report of a new takeover bid, previously rejected $42 / share offer in February (Seeking Alpha)
WideOpenWest (WOW) jumped on a report the Company is exploring options, including a sale (Tipranks)

Update on Shareholder Activism

Bank of Marin (BMRC) investors get a board seat and agree to extend restricted period (Filing)
Genworth Financial (GNW) activist investor, Seven Corners Capital, urged shareholders to withhold votes at upcoming annual general meeting (Proxy)
Guess? (GES) filed its definitive proxy and issued an investor presentation highlighting business transformation amid proxy fight with Legion (Presentation)
Hasbro (HAS) expanded its Board by two and rejected calls for a spinoff of the Wizards of the Coast unit amid an ongoing battle with Alta Fox (Filing)
LivePerson (LPSN) activist investor Starboard issued a letter highlighting past underperformance (Letter)
Middlefield Banc (MBCN) urged shareholders to vote against activist investor Ancora’s proposal to immediately explore a sale (Proxy)
NeoGeonomics (NEO) gained on speculation it could be a prime target for activists after its CEO resigned (Pulse 2.0)
New York City REIT (NYC) activist Comrit Investments filed a definitive proxy (Proxy)
Peoples Financial (PFBX) activist Stilwell Value filed a definitive proxy in the contested election as it implores the company to explore “maximizing shareholder value” (Filing)
Republic First Bancorp (FRBK) delayed its 10-K filing and annual general meeting amid related party transactions investigation (Press Release)
Southwest Gas (SWX) mailed a letter to stockholders highlighting the value of MountainWest acquisition (Letter) after Carl Icahn issued a presentation to shareholders in ongoing battle (Presentation)
Turtle Beach (HEAR) activist investor Donerail urged shareholders to prepare for upcoming proxy vote (Filing)
Twitter (TWTR) appointed Elon Musk to its board (Reuters)
Ventas (VTR) activist Land & Buildings issued an investor presentation highlighting Ventas’ “decade of underperformance” (Presentation)
Zendesk (ZEN) activist investor Jana Partners again pressured the company to schedule the annual general meeting (Filing)

Update on Other Special Situations

Spin-Offs

AT&T’s (T) spin-off of WarnerMedia and merger with Discovery (DISCK) was completed, creating Warner Bros. Discovery (WBD) (Variety)
Becton, Dickinson and Company (BDX) completed the spin-off of Embecta (EMBC) (Press Release)
Conduent (CNDT) announced it is pursuing either a sale or spin-off of its transportation business (Press Release)
Enovis (ENOV) completed the spin-off of ESAB Corporation (ESAB) (Press Release)

Other

888 (LSE: 888) to pay a reduced price to buy William Hill’s non-US assets from Caesars (CZR) (Reuters)
Atlantia (ATASY) rebuffed interest from GIP and Brookfield Asset Management (BAM), instead preferring a deal with Blackstone (BX) (Yahoo)
Change Healthcare (CHNG) and UnitedHealth (UNH) agreed to extend merger closing date amid regulatory pressure (Reuters)
Farfetch (FTCH) announced a strategic partnership and $200mm minority investment in Neiman Marcus (Press Release)

Announced M&A

Target / Acquirer – Transaction Enterprise Value

Consumer / Retail

Main Event / Dave & Busters (PLAY) – $835mm (Press Release)

Financials

Leveraged Commentary & Data / Morningstar (MORN) – $650mm (Press Release, Presentation)

Healthcare

AltheaDx / Castle Biosciences (CSTL) – $140mm (Press Release, Presentation)
ReViral / Pfizer (PFE) – $525mm (Press Release)
Tivity Health (TVTY) / Stone Point Capital – $2bn (Press Release)

Industrials

C&K Components / Littelfuse (LFUS) – $540mm (Press Release)

Technology, Media & Telecommunications

CDK Global (CDK) / Brookfield (BBU) – $8.3bn (Press Release)
Pensando / AMD (AMD) – $1.9bn
Tufin (TUFN) / Turn/River Capital – $570mm (Press Release)
Wyre Payments / Bolt – $1.5bn (Reuters)

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