Friday, December 29, 2006
UPDATE: Stifel Nicolaus Sees Possibility of Bidding War for Alltel (AT)
The firm said a possibility exists of a potential bidding war between interested parties and believes valuations could climb to as high as $85/share in a competitive bidding environment.
The firm maintains its Buy rating and $68 price target and said the stock remains its top US-based stock.
Hutchison Telecommunications (HTX) Confirms It Has Been Approached Regarding a Sale of Its Interest in Hutchison Essar Limited
In a 6-K, Hutchison Telecommunications International Ltd. (NYSE: HTX) noted the recent increase in the price of its shares and stated that it is not aware of any reasons for such increase other than as may relate to market speculation on a possible sale of its equity interests in Hutchison Essar Limited.The company noted that while it has been approached by various potentially interested parties regarding such a sale, no agreement has been entered into up to the date of this announcement. There is no assurance that a sale may result from these approaches.
Private Equity Firms Looking at Alltel (AT) - WSJ
According to reports from the Wall Street Journal, private equity firms are looking at Alltel Corp (NYSE: AT) as a possible takeover target. According to the report, the balance-sheet strength would give buyers room to load up debt. The size of the deal would be large - with the currently market value of Alltel at $21.7 billion.A potential strategic buyer for Alltel could be Verizon Wireless, a joint venture of Verizon Communications Inc. (NYSE: VZ) and Vodafone Group PLC (NYSE: VOD). Link to Article $
Thursday, December 28, 2006
Applebee's (APPB) and Wendy's (WEN) Mentioned As Takeover Targets on CNBC
Link to CNBC Video
Rumor DG FastChannel (DGIT) Could Buy Point.360 (PTSX) Following Buying Large Stake
Wednesday, December 27, 2006
Oil/Gas Takeover Targets Mentioned on CNBC: UPL, CXG, XTO, EOG, RRC, OXY
Link to CNBC Video
Reports Willis Group (WSH) Still Interested in Buying Marsh & Mclennan (MMC)
Claire's Stores (CLE) option implied volatility of 25 at low end of Range
Tuesday, December 26, 2006
Bisys (BSG) Considering a Management-Led Buyout - FT.com
According to reports from FT.com, Bisys (NYSE: BSG) is considering a management-led buyout and has hired Bear Stearns to evaluate strategic options. The report noted that Bisys recently settled SEC fraud charges.
The article also noted a recent Jefferies report suggesting the best path for Bisys would be a takeover and a price of $13 or above would be justified.
Ford Motor (F) Slightly Higher On Reports of Meeting with Toyota
Shanda (SNDA) Higher on Rumors Google May Buy Qidian for $400-$600M
Shanda Interactive (Nasdaq: SNDA) is higher today on rumors Google (Nasdaq: GOOG) may be interested in buying Chinese literature site Qidian (www.cmfu.com) owned by Shanda for between $400-$600 million. According to Bloomberg, a Shanghai-based spokesman for Shanda denied the report.
Shares of Shanda are 6.9% to $21.38 in mid-day action.
Rumored Takeover Targets for 2007
This is our first time doing this, so there is no history of how well the list could do and as we state in the title - NEVER BUY A STOCK ON A RUMOR!
Sepracor, Inc. (Nasdaq: SEPR)
RadioShack (NYSE: RSH)
Citrix Systems, Inc. (Nasdaq: CTXS)
Business Objects SA (Nasdaq: BOBJ)
EMC (NYSE: EMC)
Kimberly-Clark (NYSE: KMB)
Apache Corp. (NYSE: APA)
KB Home (NYSE: KBH)
Borders Group, Inc. (NYSE: BGP)
Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT)
Genesis Microchip Inc. (Nasdaq: GNSS)
Imclone Systems Inc. (Nasdaq: IMCL)
Smith & Nephew plc (NYSE: SNN)
XM Satellite Radio Holdings Inc. (Nasdaq: XMSR)/Sirius Satellite Radio (Nasdaq: SIRI) merger
Guitar Center Inc. (Nasdaq: GTRC)
Foot Locker Inc. (NYSE: FL)
Forest Laboratories Inc. (NYSE: FRX)
BEA Systems Inc. (Nasdaq: BEAS)
TIBCO Software Inc (Nasdaq: TIBX)
Tellabs Inc. (Nasdaq: TLAB)
Health Net Inc. (NYSE: HNT)
Nabors Industries Ltd. (NYSE: NBR)
Cyberonics Inc. (Nasdaq: CYBX)
Louisiana-Pacific Corp. (NYSE: LPX)
Nektar Therapeutics (Nasdaq: NKTR)
Here are some others that are not so much rumored targets but have put for sale signs up, were for sale in the past or are getting pushed by shareholders to sell:
Brinks Co. (NYSE: BCO)
Catalina Marketing Corp. (NYSE: POS)
Griffon Corp. (NYSE: GFF)
Cost-U-Less, Inc. (NASDAQ: CULS)
MedImmune Inc. (Nasdaq: MEDI)
Salton Inc. (NYSE: SFP)
World Air Holdings, Inc. (OTC: WLDA)
Southern Union Company (NYSE: SUG)
Pogo Producing Co. (NYSE: PPP)
Northwest Airlines Corp. (OTC: NWACQ)
Mills Corp. (NYSE: MLS)
CSK Auto Corp. (NYSE: CAO)
Steris Corp. (NYSE: STE)
Quipp, Inc. (NASDAQ: QUIP)
InFocus Corporation (Nasdaq: INFS)
Emmis Communications Corp. (Nasdaq: EMMS)
Finish Line Inc. (Nasdaq: FINL)
Glenayre Technologies, Inc. (Nasdaq: GEMS)
Great Wolf Resorts Inc. (Nasdaq: WOLF)
Herley Industries, Inc. (Nasdaq: HRLY)
Houston Exploration Co. (NYSE: THX)
North Pittsburgh Systems Inc. (Nasdaq: NPSI)
Sunterra Corporation (OTC: SNRR)
Vitesse Semiconductor (OTC: VTSS)
Inter-Tel Inc. (Nasdaq: INTL)
Zale Corp. (NYSE: ZLC)
Millicom International (Nasdaq: MICC)
R.R. Donnelley & Sons Company (NYSE: RRD)
Friday, December 22, 2006
Takeover Speculation Continues to Surround Kimberly-Clark (KMB)
According to various reports, Kimberly-Clark Corp. (NYSE: KMB) call options were active yesterday on speculation the company could be a takeover target.
Kimberly-Clark has been seen as a takeover target since the 2005 buyout of competitor Georgia Pacific. Merrill Lynch has Kimberly-Clark on the top of their list of possible takeover targets.
The common stock of KMB is lower today, giving back most of yesterday's small gains.
Thursday, December 21, 2006
Napster (NAPS) To Be Bought at 100%+ Premium?
Merrill Mentions HLT and OEH As Takeover Targets
TNS Receives $20 Takeover Offer from Founder and Former CEO
Smith & Nephew (SNN) Higher As Takeover Speculation Grows
Smith & Nephew plc (NYSE: SNN) is 3% higher in early action on growing takeover speculation. According to reports, the private equity group that bought Biomet, Inc. (NASDAQ: BMET) could also target Smith & Nephew. The group was made up of Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co. and TPG.
Smith & Nephew and Biomet were engaged in merger talks prior to the private equity group deal.
Wednesday, December 20, 2006
Cramer Mentions AGN for ELOS Rumors on Mad Money
Maxim Integrated (MXIM) Higher On Takeover Talk Following CEO Retirement
Online Advertising Firms Higher on Digitas (DTAS) Takeover
Tuesday, December 19, 2006
Redback (RBAK) Takeover Rumors Prove True, Ericsson Pays $25/Share
NOTE: Today RBC analyst Mark Sue downgraded the stock, citing 'limited upside' and claiming a takeover was 'unlikely'. OUCH - BAD CALL
ElkCorp (ELK) Higher on Rumors of New Bid
Reports Harrah's (HET) Deal Done at $90
RBC Capital Downgrades Redback (RBAK), Says Takeover Not Imminent
The analyst said Cisco (Nasdaq: CSCO) and Juniper (Nasdaq: JNPR) are unlikely suitors given product overlap, Alcatel-Lucent (NYSE: ALU) is working on an improved switch fabric and Motorola (NYSE: MOT) may have its hand full. Link to Barron's
Monday, December 18, 2006
Brink's (BCO) Gets More Pressure From Holders for a Sale
Former Cendant Parts Wyndhan (WYN) and Avis Budget (CAR) Higher Following Realogy Buyout
Spin-offs of the former Cendant, Wyndhan (NYSE: WYN) and Avis Budget Group, Inc. (NYSE: CAR), are seeing interest today following the private equity buyout of Realogy Corporation (NYSE: H), another piece of the former Cendant.Talk on the street is private equity firms are also crunching the numbers on takeovers of these former Cendant units.
Imclone (IMCL) Higher on Takeover Chatter
Mamma.com (MAMA) Continues Recent Move
Mamma.com Inc. (Nasdaq: MAMA) is continuing last week's momentum despite word Mark Cuban denied rumors he was buying a position in the company again after selling out in 2004.
According to a posting at RealMoney.com Friday, Hal Uy said, Cuban responded to his e-mail on the rumor saying, "Nonsense. No Chance. Won't happen."Shares of Mamma.com are 13% higher in early action today after running up from $2.37 since last Tuesday on news of the launch of its new video search, and extending gains Friday on the Cuban rumor.
Compuware (CPWR) Seen As a Takeover Target - TheDeal
Cramer Thinks Alcoa (AA) Gets Bought in 2007
Sunday, December 17, 2006
Apollo and Texas Pacific Set to Win Harrah's (HET) Auction With $90+ Bid - WSJ
According to reports from the Wall Street Journal Sunday, the private equity team of Apollo Management and Texas Pacific Group are set to win the auction for Harrah's Entertainment (NYSE: HET), with an offer of at least $90 per share.
The article said while a last minute hiccup could still derail the deal, an announcement is expected on Monday.
Friday, December 15, 2006
Wedbush Said Genesis Microchip (GNSS) Biz Will Likely Remain Sluggish in Q1, Sees As Possible Takeover
In a note today on Genesis Microchip (Nasdaq: GNSS) Wedbush Morgan said checks suggest the company's business will likely remain sluggish in Q1 with a near-term snap back in revenues seemingly unlikely. The firm also said even with the low valuation, they remain on the sidelines citing a deteriorating design win picture for 2007, and their concerns about significantly more competition in the DTV chip market in 2007.
The firm does not recommend shorting the stock given that Genesis could be an acquisition target.The firm maintains their Hold rating and $11 price target.
Mamma.com (MAMA) Sees Upside Action on Cuban Rumor
Today's continued run-up in shares of Mamma.com Inc. (Nasdaq: MAMA) is being attributed to rumors earlier in the day that billionaire Mark Cuban is buying the stock again after selling his original stake back in 2004.
Shares of Mamma.com are up significantly this week following news the company launched its new video search engine.
We are now hearing that Cuban could be denying today's rumors, although we've seen nothing on any of the wire services suggesting this is the case.NOTE: It is our personal opinion that it would be more likely that Cuban would be short the stock versus buying it after the recent run-up. Cuban is also known for being tech savvy, an area Mamma.com continues to lag.
Street Waits on Harrah's (HET) Bid News
According to reports from the Wall Street Journal today, Penn National Gaming (Nasdaq: PENN) made a competing offer to the bid from private equity groups Texas Pacific Group and Apollo Management, which earlier in the week was raised to $87.
Thursday, December 14, 2006
J C Penney (JCP) Higher on Renewed LBO Talk
Cramer Doubts Lampert Would Buy Gap (GPS)
Commenting on renewed speculation that hedge fund guru and Chairman of Sears Holdings (Nasdaq: SHLD) Eddie Lampert may try to buy Gap Inc. (NYSE: GPS), Jim Cramer, at RealMoney.com said, "Eddie has poached the best people from Gap over the years. I doubt he would want to buy the company when he can buy the people." Cramer suggests the rumors are being floated by bears in Sears Holdings.Shares of Gap are up 2.7% today after the rumors were discussed at industry publication, Women's Wear Daily (WWD.com).
Worthington Industries (WOR) Higher on Mittal Takeover Speculation Following Analyst Note
Shares of Worthington Industries (NYSE: WOR) are higher in early action today following a note from Prudential calling the company a possible takeover target from Mittal (NYSE: MT). The analyst placed 10-20% odds on Mittal bidding $35 to $45 for Worthington.Shares of Worthington Industries are 11.7% higher to $20.43 in early action today.
Jefferies Comments on SiRF (SIRF) Says TomTom Second Source is No Longer Just a Rumor
Gap (GPS) Higher on More Lampert Speculation
Specialty retailer Gap Inc. (NYSE: GPS) is higher this morning on reports from Women's Wear Daily (WWD.com) the speculation that hedge fund billionaire Edward Lampert is looking to takeover the company won't die down.Shares of Gap are 1.7% higher to $19.90 in early action.
Wednesday, December 13, 2006
Google For Tivo Rumor Makes The Rounds Again
Harrah's Entertainment (HET) Sees Volatility Mid-Day on Rumors
Harrah's Entertainment Inc. (NYSE: HET) has seen some volatility mid-day today as rumors swirl the company could opt for a recapitalization versus a private equity buyout. A decision from the company is expected later in the week.
The latest reports suggested the private equity group of Apollo Management and Texas Pacific Group would raise their bid from $83.50 to $87. The stock is currently at $79.40.
MedImmune (MEDI) Holder Matrix Asset Advisors urges a sale of the company
Airlines Stock Take Flight on More Industry Consolidation News
In addition, AirTran Holdings Inc. (NYSE: AAI) confirmed it made an $11.25 per share offer for Midwest Air Group (NYSE: MEH), which was rejected. Link
Other stocks in the sector are also higher as industry consolodation takes shape: AMR Corporation (NYSE: AMR), Frontier Airlines Holdings, Inc. (Nasdaq: FRNT), JetBlue Airways Corp. (Nasdaq: JBLU), Northwest Airlines (OTC: NWACQ), Hawaiian Holdings Inc. (NYSE: HA), Alaska Air Group Inc. (NYSE: ALK)
Tuesday, December 12, 2006
Monarch Activist Partners Wants Cost-U-Less (CULS) To Sell
Does Sabre Buyout Put PCLN and EXPE in Play?
The stocks are doing little today but you can expect more chatter on the names going forward as sector consolidation takes shape.
Today's Sabre deals follows news this summer that a Blackstone Group affiliate bought Cendant's Travelport, which operates Orbitz.com, for $4.3 billion.
Private Equity Group Expected to Raise Harrah's Bid to $87 - WSJ
According to reports from the Wall Street Journal, Apollo Management and Texas Pacific Group are expected to raise their bid for Harrah's Entertainment (NYSE: HET) from $83.50 to $87.
Final bids for Harrah's are due today and a decision from the company is expected later this week.Shares of Harrah's closed at $79.74 on Monday.
Factory Card & Party Outlet (FCPO) Exploring Possible Sale
Sabre Holdings (TSG) Bought By Private Equity Group
Reports Terayon (TERN) Is a Takeover Target
Monday, December 11, 2006
New River Pharmaceuticals (NRPH) Higher on Merger Chatter
Gannett Co (GCI) Denies Report of Selling its UK Subsidiary Newsquest
Citigroup Doesn't Think Altria (MO) Will Buy Gallaher, Sees Price Increase
Claire's Stores (CLE) Higher On Reports Takeover Getting Closer
Claire's Stores, Inc. (NYSE: CLE) is higher this morning following reports from Women's Wear Daily the company entered into the second round of bidding with offers said to be around $39 per share.
Earlier in the month, Claire's Stores said it was exploring strategic alternatives for enhancing shareholder value, including a possible sale of the company. The Company has retained Goldman, Sachs & Co.
Claire's Stores, Inc. is a leading international specialty retailer offering value-priced costume jewelry and accessories to fashion-aware tweens, teens and young adult females through its two store concepts: Claire's and Icing by Claire's.Shares of Claire's Stores are 4.5% higher to $34.60 in early action.
Harrah's (HET) implied volatility at 19 as HET board expected to discuss Bids on 12/13
Reports Taro Pharmaceutical (TARO) In Talks to Be Acquired
Smith & Nephew Plans $11B Bid for Biomet (BMET)
Bids are due Tuesday and others will also likely submits offers, the sources said.Earlier in the month, Smith & Nephew confirmed that it has held very preliminary talks with Biomet.
Reports Sabre Holdings (TSG) Is Up for Sale
Friday, December 08, 2006
UPDATE: Catalina Marketing (POS) Confirms Offer, Goldman Hire
The Company's board of directors formed a special committee which has authorized Goldman Sachs to solicit expressions of interest from other third parties and advise it with respect to the board's consideration of any expressions of interest and the advisability of pursuing a sale of the company.
UPDATE: Catalina Marketing (POS) Higher on Sale Report
According to the report, which cited unnamed sources, six private equity firms were looking at the company.
Catalina Marketing offers behavior-based marketing programs for companies.
Shares of Catalina Marketing quickley rose 16% to $28.30 following the initial reports.
Catalina Marketing (POS) spikes higher on reports the company hired a banker for a sale
UPDATE: Citigroup Said CFO Rumor Not True, Won't Comment on Break-up Rumor - Bloomberg
Citigroup (C) Higher on Management Shake-Up and Break-Up Rumors
There is market talk that Banc of America's departing CFO Molina could take the job at Citigroup. Recently rumors swirled that Citigroup's CFO Sallie Krawcheck was not happy with the job and was on her way out, although the company denied the reports.
Medicines (MDCO) Higher on Patent Rumor
Northwest Airlines (NWACQ) Hires Evercore for possible M&A Deal
CNBC Commentator Discusses Recent Buyout Rumors
Merrill Lynch Analyst says Bank of America (BAC) Interested in Acquiring Barclays Bank (BCS)
Thursday, December 07, 2006
Rumors Yahoo! (YHOO) May Buy Metacafe for $200M
TiVo/Apple Rumor? What About TiVo/Google?
Many are calling the deal unlikely.
We also heard Google (Nasdaq: GOOG) may look to partner with TiVo.
Shares of TiVo are down 4%, suggesting traders see little chance of either happening.
Does the News Corp/Liberty Asset Swap Deal Put EchoStar (DISH) In Play?
Smith said the deal will clean up the ownership structure of both NWS and DTV, leaving either to buy EchoStar. Smtih said Liberty could also buy DISH, to complement its European satellite business BSkyB.
In the past, AT&T (NYSE: T) was also mentioned as a possible buyer for DISH, which has long been a rumored target.
SIRI/XMSR Merger Rumors Continues to Buzz
Analyst Said Zimmer Holdings (ZMH) Could Be a Buyout Target
Gap (GPS) Higher on More LBO Chatter
NOTE: GPS has been mentioned as a takeover target for some time, but some analysts have said a deal is unlikely.
Rumors Apple's iPhone Will Be Delayed Until March
BioMarin (BMRN) Mentioned As Takeover Target
According to the report, the CEO said he opposes the idea of a takeover, but does acknowledge that they cannot remain independent forever. Link
Vanda Pharmaceuticals (VNDA) CEO Says Company May Be Acquisition Target By Big Pharma
Vanda Pharmaceuticals Inc. (Nasdaq: VNDA) made positive comments on its Phase III trial of Iloperidone antipsychotic drug on CNBC. The CEO also said that other pharmaceutical companies have expressed interest in acquiring VNDA because of its strong pipeline.
NOTE: VNDA is up 60% in pre-open action today on the Phase III news
Sanders Morris Harris Sees Takeover Potential in Ceragon Networks (CRNT)
Altria (MO): Won't Comment On Whether Gallaher (GLH) Of Interest - DJ
Eli Lilly (LLY) CEO Said It Does Not Plan to Raise ICOS Offer
Shares of ICOS closed at $33.37 yesterday on expectations of an increased bid. Some shareholders plan to vote against the merger, saying it undervalues the company.
Stifel Nicolaus Sees Potential Change of Control at American Italian Pasta (PLB)
Analyst George I. Askew said, "We believe that a potential change of control could occur at American Italian Pasta over the intermediate term once the company re-files financial statements with the SEC. Importantly, affiliates of private equity group Sun Capital are believed to own over 13% of the company's shares and the short interest in the company's stock is estimated at 35% to 40% of shares outstanding.
UBS Says Biomet (BMET) Will Likely Be Bought
News (NWS) Near Deal with Liberty Media - WSJ
Wednesday, December 06, 2006
Gallaher Group Plc (GLH) Confirms Offer Speculation
Gallaher Group Plc (NYSE: GLH) notes the recent speculation concerning the possibility of an offer being made for Gallaher.The Company confirms that it has recently received an approach which may or may not lead to an offer. The approach is preliminary and there can be no assurance that any offer will be made.
Credit Suisse Also Mentions Advance Auto Parts (AAP) and Guitar Center (GTRC) as LBO Targets
In addition to discussing Barnes & Noble Inc. (NYSE: BKS) as a possible LBO target, Credit Suisse also mentions Guitar Center Inc. (Nasdaq: GTRC) and Advance Auto Parts Inc. (NYSE: AAP) as possible targets.
The firm said in the past Guitar Center said it would be easier to manage the business as a private company and the company has held discussions with large shareholder Sageview Capital, which is run by two ex-stars at private equity giant KKR.
The firm said Advance Auto Parts makes the most sense in the do-it-yourself auto segment.
International Coal (ICO) Denies Takeover Rumors
Hansen Natural (HANS) Higher on LBO Rumor
Hansen Natural Corp. (Nasdaq: HANS) is seeing interest today on LBO chatter.
In the past, it was rumored that partner Anheuser-Busch (NYSE: BUD) could buy the company in a strategic deal.
The stock is 3.5% higher in mid-day action on volume that has already eclipsed the 3-month average.
Citigroup Said Deere (DE) Approached by Private Equity
Citigroup analyst, David Raso, comments on meeting with Deere & Co (NYSE: DE) management: "Discussion focused mostly on potential areas for acquisitions/business build outs given hugely strong balance sheet and on the sustainability of its strongly improving Shareholder Value Add metrics. However, some interesting color included CEO answering our questions acknowledging company has been approached by private equity to buy the company though management seemed to genuinely dismiss the potential for such an event."
"As well, somewhat disappointing when it comes to accounting earnings potential over the next 24 months is when we asked mgmt about its journey to continually reduce inventory in the channel and if production could stay below retail demand, mgmt noted that's possible."
Jefferies Said Perot (PER) Is an Attractive LBO Target
Analyst Joseph A. Vafi said, "While we have no reason to believe that the company is currently engaged or interested in a buyout transaction, we feel that Perot's valuation and business model are appealing to private equity players. We feel that shares of PER would fetch $20-21 in such a transaction."
Timberland (TBL) Slightly Higher After Cramer Mentions Possible Takeover
According to recent reports from the Wall Street Journal, Timberland hired Goldman Sachs to explore strategic options including a possible sale.
Shares of Timberland are 1.6% higher to $32.35.
Credit Suisse Sees Possible Barners and Noble (BKS) Takeover
Tuesday, December 05, 2006
Relational Investors Said No Deal with Banco Santander on Sovereign (SOV) Sale
InterContinental (ICE) Higher on Renewed Takeover Speculation
Soleil Securities Doesn't See Takeover of Lexmark (LXK)
Ceradyne (CRDN) Higher on Takeover Speculation
Cramer Mentions Medtronic (MDT) for Cyberonics (CYBX) Rumors Again
At RealMoney.com, Jim Cramer says news from Medtronic Inc. (NYSE: MDT) that they are spinning-off their defibrillator unit to focus on treatments of chronic medial conditions could prelude a takeover of Cyberonics Inc. (Nasdaq: CYBX).Cramer mentioned a possible takeover scenario of CYBX by MDT on Mad Money on 11/22.
Cyberonics has seen a notable run-up recently following the CEO's departure and a recent disclosure that activist investors Carl Icahn accumulated a position in the company.
Baidu.com (BIDU) Higher Following Note on Possible Microsoft Deal
Cowen Says Use Takeover Rumor Run-Up to Exit COGN and BOBJ
Cowen downgrades Cognos (Nasdaq: COGN) from Outperform to Neutral, citing valuation after takeover speculation run-up. The firm sees limited upside in a takeover, but significant downside if a takeover doesn't materialize.
The firm makes similar comments on Business Objects SA (Nasdaq: BOBJ), saying the run-up on takeover speculation provides a nice exit opportunity.
Monday, December 04, 2006
WR Hambrecht Said Pfizer (PFE) May Buy Nektar (NKTR) Following Torcetrapib Blow-Up
The firm said, "While our fundamental analysis of NKTR shares on rapidly improving Exubera visibility over the next few months remains unchanged with our target price of $30, the news of Exubera partner Pfizer's most visible late stage pipeline product which was touted as the next Lipitor to reach the market in the next few years at its annual R&D day last Thursday is nothing less than shocking and raised the obvious question: What can PFE do to close this strategic gap where some $10B in future potential revenues is suddenly removed from everybody's models. In our view, Pfizer senior management is now more likely to look outside the company for growth which should include potential acquisitions that will increase earnings in the 2008 + timeframe. As we have opined in the past, NKTR captures about half of Exubera earnings which looking out to 2010 represent about 30% in operating income or around $300M of the projected $600M of $2B worldwide Exubera sales (PFE's guidance has been north of $2B by 2010). Valuing NKTR via discounting 2010 earnings ($2.00) or the NPV of PFE's lost Exubera earnings it would have by owning NKTR, we estimate NKTR value to PFE at $35 to $40 which does not include a potential premium for NKTR's pipeline which now has 10 products in clinical trials or the potential strategic value of a San Francisco Bay Area footprint to amplify PFE's R&D capability which judging from the news out this morning may be more productive externally than what has been coming out of Groton, CT."
Boyd Gaming (BYD) Higher Following Station Casinos' (STN) Takeover Offer
STN and BYD had been seen as the next gaming companies to go.
Takeover speculation in the group has been rampant since Harrah's Entertainment (NYSE: HET) received a $15 billion buyout proposal from private equity firms Apollo Management and Texas Pacific Group in October.
ISIS Pharmaceuticals (ISIS) Higher Following Negative Pfizer News
Soleil Securities upgrades Sepracor (SEPR) to Buy, Says Far More Attractive Takeover Target
Analyst Matt Renna of Neponset Equity Research said, We believe now a far more attractive consolidation target and see the possible addition of SEPR's portfolio to the bag of a larger player as a means to improve sales force efficiency."
Friday, December 01, 2006
Home Depot (HD) CEO Downplays LBO Speculation - Paper
Nardelli told the paper, "somebody is probably running the number on us on any given day." He also said the media reports are, "an unfortunate distraction."
Recent reports from the New York Post suggested buyout firms Kohlberg Kravis Roberts and Texas Pacific Group have explored the possibility of a record $100 billion leveraged buyout of the home improvement giant.
Shares of Home Depot are 3.8% higher in mid-day action Friday.
Citigroup Analyst Comments on Novellus Systems (NVLS) Takeover Chatter
Citigroup analyst, Timothy Arcuri, comments on Novellus Systems (Nasdaq: NVLS): "While a private equity deal here can't be ruled out, necessary hurdle rates for returns remain difficult to achieve based on our work. Rather, we feel an acquisition by a peer such as Tokyo Electron - while risky - is more likely at this point and we now feel the probability of NVLS being acquired in the next 1-2Qs is at least 50%."Arcuri continued, "While a deal would clearly move the stock higher, absent this factor, the fundamental margin story here has played out and shares are now under some pressure in core businesses such as CVD. We thus maintain Hold, $32 price target."
USG A Takeover Target?
Home Depot (HD) Higher As LBO Talk Gains Steam
Shares of Home Depot Inc. (NYSE: HD) are 4% higher in early action as LBO speculation gains steam. A takeover of the home improvement giant would seem completely far-fetched not so long ago, but with the activity and wealth of private equity buyers, analysts now say a deal could make sense.Recent reports from the New York Post, suggest private equity firms including KKR have held talks with investment banks about structuring the deal.
UPDATE: Claire's Stores (CLE) Confirms It Hired Banker to Explore Strategic Alternatives
UPDATE: Claire's Stores, Inc. (NYSE: CLE) confirmed that it is exploring strategic alternatives for enhancing shareholder value, including a possible sale of the company. The Company has retained Goldman, Sachs & Co. as its financial advisor to assist in this effort. The Company stated that there can be no assurance that this process will result in any specific transaction.