As this week has started, North America is awash in deals and deal proposals, including big ones in the media (Reuters/Thomson Financial) and metals-and-mining industries (Alcoa/Alcan). In short, it’s a lot like last week, when the same industries dominated the M&A news.
In one divergent theme for the week ended May 4, though, private-equity buyouts were overshadowed among the top ten.
In what appears to be a steady march toward a 2007 record for M&A, last week’s largest deal was the management buyout of Cablevision Systems Corp. by the Dolan family, its controlling shareholders, for $22.5 billion. The private-equity LBO among the leaders was the $7.1-billion deal for U.S. Foodservice Inc. by Kohlberg Kravis Roberts & Co. and Clayton Dubilier & Rice Inc., according to data provided to CFO.com by mergermarket. (News Corp.’s. $5-billion offer for Dow Jones wasn’t included in the report, which concentrates on announced deals.)
This Monday’s Alcoa offer for Alcan, which the Canadian aluminum maker said it would consider, continued the year’s frenzied global activity in natural resources. In the oil and gas fields last week, Eni Petroleum Co. struck a deal to buy the Gulf of Mexico assets of Dominion Resources Inc. for $4.7 billion, while Husky Energy Inc. will buy Lima Refining Co. from Valero Energy Corp. for $1.9 billion. Meanwhile, Sweden’s SSAB Svenskt Stal AB agreed to buy Ipsco Inc. for $8.4 billion, and Moscow’s Norilsk Nickel MMC bid $4.1 billion for LionOre Mining International Ltd.
The financial services section again registered strong dealmaking, accounting for four of last week’s top ten. JP Morgan advised four deals, the leader for the week.
Charles Dolan family to buy Cablevision Systems for $22.5 billion
Terms call for a $36.26-a-share price for Cablevision that contains a premium of 10.99 percent.
Seller financial advisor: Morgan Stanley; Lehman Brothers
Bidder financial advisor: Bear, Stearns & Co.; Merrill Lynch
Seller legal advisor: Sullivan & Cromwell; Willkie Farr & Gallagher
Bidder legal advisor: Shearman & Sterling (advising Bear Stearns and Merrill Lynch); Skadden Arps Slate Meagher & Flom; Debevoise & Plimpton
SSAB to buy Ipsco for $8.4 billion
The definitive agreement, at $160 a share, is at a 7.7-percent premium.
Seller financial advisor: Goldman Sachs; RBC Capital Markets
Bidder financial advisor: Greenhill & Co.; Handelsbanken Capital Markets
Seller legal advisor: Davies Ward Phillips & Vineberg (advising Goldman Sachs); Davis Polk & Wardwell; Osler Hoskin & Harcourt; Sullivan & Cromwell (advising Goldman Sachs)
Bidder legal advisor: White & Case; Bennett Jones
Clayton Dubilier & Rice and KKR to buy U.S. Foodservice from Royal Ahold NV for $7.1 billion
Clayton Dubilier and KKR, which won the auction for U.S. Foodservice, get a 50 percent stake each in the company, together contributing equity in the range of $2 billion to $2.5 billion, with the balance being infused through debt. Completion is expected in the second half of 2007.
Seller financial advisor: JPMorgan; Goldman Sachs
Bidder financial advisor: Citigroup; Deutsche Bank; Morgan Stanley; Rabobank
Seller legal advisor: White & Case
Bidder legal advisor: Debevoise & Plimpton; Simpson Thacher & Bartlett