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The Special Situation Report #23: 6/26 Roundup

www.thespecialsituationreport.com

The Special Situation Report #23: 6/26 Roundup

Summary of the Week in Special Situations

David Paolella
Jun 26, 2022
20
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The Special Situation Report #23: 6/26 Roundup

www.thespecialsituationreport.com

I hope you enjoyed my report on Square Enix.

I am grateful to have built a global audience of 1,000+ investors in just a few months. Truth be told, I have a lot in the works for this website in terms of additional resources to add to your investor toolkit. But in the meantime, expect more of the same - including a new writeup next week (I’m heading back Stateside to cover a company in the healthcare sector).

On an unrelated note, I found this article from the Financial Times to be interesting - make of it what you will:

“Surge in end-of-quarter rallies driven by funds, research suggests” (Link)

Bar chart of Excess average daily return, annualised (%) showing S&P 500 performance, 2016 to present

Table of Contents:

  1. Update on Developing M&A

  2. Update on Shareholder Activism

  3. Update on Other Special Situations

  4. Announced M&A


Update on Developing M&A

Strategic Alternatives & Ongoing Situations

  • Kohl's (KSS) bidder Franchise Group (FRG) is considering lowering its offer to $50 per share (CNBC)

  • PBF Logistics (PBFX) gained as PBF Energy (PBF) disclosed it was mulling a takeover bid (Filing)

  • Spirit (SAVE) amended its merger agreement with Frontier (ULCC) (Press Release), shunning JetBlue’s (JBLU) $33.50 per share proposal (Press Release)

  • Toshiba (TOSYY) bidders are considering takeover offers as high as 7,000 yen (Reuters)

Rumors

  • Block (SQ) speculation it may attract an activist investor or takeover bid as its stock languishes (Axios Pro)

  • Celsius Holdings (CELH) may be a takeover target for Pepsi (PEP) (Seeking Alpha)

  • Occidental Petroleum (OXY) may be the next takeover target of Buffett’s Berkshire (BRK) as it continues to buy additional shares (Seeking Alpha)

  • Seagen (SGEN) merger talks with Merck (MRK) are reportedly picking up pace (WSJ)


Update on Shareholder Activism

  • Aerojet Rocketdyne (AJRD) CEO gets vote of confidence from ISS and Glass Lewis in proxy battle (Reuters)

  • CalAmp (CAMP) entered into cooperation agreement with B. Riley Asset Management (Press Release)

  • Catalyst Biosciences (CBIO) 8% shareholder JEC II engaging with management regarding returning cash to shareholders

  • Mercury Systems (MRCY) entered into cooperation agreements with Jana, Starboard (Press Release)

  • New Relic (NEWR) Jana Partners added to its stake (Filing)

  • Zendesk (ZEN) Jana pulled its proxy fight after ZEN announced a go-private transaction (Filing)


Update on Other Special Situations

Spin-Offs

  • Kellogg (K) announced spin-offs of its cereal and plant-based businesses, separating them from its snacking business (Press Release)

  • Seanergy Maritime (SHIP) announced a proposed spin-off (Press Release)

  • Volkswagen (VWAGY) is pushing ahead with Q4 Porsche IPO; eyes 2023 listing of its battery unit (Bloomberg)

Other

  • ODP Corporation (ODP) decided to keep all of its businesses together, scrapping earlier plans to separate its B2C and B2B businesses (Press Release)

  • Rogers (RCI) and Shaw (SJR) announced an agreement to divest Freedom Mobile to Quebecor (TSX: QBR) (Press Release)


Announced M&A

Target / Acquirer – Transaction Enterprise Value

Energy & Natural Resources

  • USA Truck (USAK) / DB Schenker – $435 million (Press Release)

  • U.S. Well Services (USWS) / ProFrac Holding (PFHC) – $93mm (Press Release, Presentation)

Financials

  • GrandSouth Bancorporation (GRRB) / First Bancorp (FBNC) – $181mm (Press Release)

Healthcare

  • Convey Health Solutions (CNVY) / TPG – $1.1bn (Press Release)

  • F-star Therapeutics (FST) / Sino Biopharmaceutical – $161mm (Press Release)

  • Radius Health (RDUS) / Gurnet Point & Patient Square – $890mm (Press Release)

Industrials

  • Ocean Bio-Chem (OBCI) / OneWater Marine (ONEW) – $125mm (Press Release)

  • RADA Electronic Industries (RADA) / Leonardo DRS (Press Release, Presentation)

Technology, Media & Telecommunications

  • Zendesk (ZEN) / Hellman & Friedman & Permira – $10.2bn (Press Release)


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The Special Situation Report #23: 6/26 Roundup

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