bloggingbuyouts

Usana Health Sciences (NASDAQ: USNA) closed yesterday at $20.83. This morning, Gull Holdings announced its intention to make an offer to USNA shareholders to acquire all of the outstanding shares of USNA for $26 cash.

USNA is a developer & manufacturer of nutritional and personal care products. The stock is up 22% today on the acquisition news.

M&A Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Right after the close, Hewlett-Packard Co. (NYSE: HPQ) did actually confirm in a press release that the company was in advanced acquisition talks with IT-sourcing giant Electronic Data Systems Corporation (NYSE: EDS). While it noted that there are no assurances that a deal will be reached, Wall Street took it in good stride.

As traders look to the news covering whether or not EDS will become part of H-P, traders were looking at how to get in the news. As a result, there are many other tech and IT-sourcing companies to look at that other potential players may take an interest in.

If we took the mid-point of the pricing at $12.5 Billion we would have a rough share price of $25.00 per share on EDS. At that rough price, you would have a company that analysts expect to be priced at 18.2 times DEC-2008 earnings and 0.55-times revenue estimates.

Read the full story of "Who Could Be Next" at 247WallSt.com to see which other stocks in IT-outsourcing stocks could be in play.

Some companies get it, some don't. Circuit City Stores, Inc. (NYSE: CC) has been in the camp of companies that don't get it. That may have finally changed today.

The company appears to have finally capitulated and realized its days under its own efforts may be limited. There are two separate announcements this morning, but in reality it is all part of the same issue.

This will allow the company to deal with the activist pressure, and may ultimately lead to the company either being run by a better team or become a subsidiary of another company. The company just issued a release that it has reached an agreement with Wattles Capital Management.

Blockbuster Inc. (NYSE: BBI) and Carl Icahn may finally get their way.

Keep reading the full story at 247WallSt.com.

Jon Ogg is also a producer and editor of the "10 Stocks Under $10" weekly newsletter for 247WallSt.com.

BCE Inc. (NYSE: BCE), Canada's largest telecommunications company, announced on June 30, 2007, that it agreed to be acquired by an investment arm of Ontario Teachers' Pension Plan, Providence Equity Partners and Madison Dearborn Partners for an announced deal price of $42.75 per share. The Federal Communications Commissions cleared the deal on Dec. 20.

RBC Capital says, "Financial results were in-line with expectations . . . there was nothing in the release that should worry investors in the context of the pending privatization." BCE June option implied volatility of 53 is above its 26-week average of 34 according to Track Data, suggesting larger movement.

M&A Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Israel Cleantech Ventures (ICV) has closed its capital raise at $75 million, according to Reuters. The original target for the fund focused on clean technology exceeded its target of $60 million and they had to turn away additional investors.

Specifically, the fund will focus on Israel based or related high growth clean technology companies in sectors such as alternative energy, water conservation and purification, emissions reduction, and technologies that allow businesses to operate more efficiently and more environmentally friendly. Funded in 2006, ICV closed its first round of funding, raising $15 million in January 2006. The Globes in Israel reported that this was above target as well.

Funds came from institutional investors as well as family funds in the U.S., Europe, and Israel, such as Robeco Private Equity, a Netherlands-based asset manager, and Piper Jaffray, a U.S. financial institution.

The fund has completed seven investments, including Aqwise (waste water treatment), CellEra (fuel cells), Citrine Renewable Energy (landfill biogas treatment), Emefcy (energy production from wastewater), Metrolight (energy efficient lighting), Project Better Place (electric vehicle infrastructure), and Pythagoras Solar (solar energy).

Jon Ogg is an editor and producer for the Special Situation newsletter for 247WallSt.com.

The deadline Microsoft Corp. (NASDAQ: MSFT) imposed on Yahoo! Inc. (NASDAQ: YHOO) to come to terms on an acquisition before it moved into hostile takeover mode has come and gone, but now it appears the software maker may be taking a softer line.

Or maybe not. The Wall Street Journal reported late Wednesday that the boards of both companies met Wednesday in an attempt to reach an agreement on Microsoft raising its bid in lieu of going hostile.

At the same time, the Journal also reported that Microsoft CEO Steve Ballmer and its financial advisers had been lobbying Yahoo! shareholders to rally support for the company to accept a lower price.

Continue reading at TechConfidential.com.

Barring last-minute, behind-the-scenes maneuverings, the stalemate between Microsoft Corp. (NASDAQ: MSFT) and Yahoo! Inc. (NASDAQ: YHOO) is expected to persist through the weekend, when Microsoft's three-week deadline to reach an amicable agreement on an acquisition expires.

Microsoft on April 5 said if an agreement with Yahoo! was not concluded by April 26, it would take its case directly to Yahoo! shareholders and initiate a proxy contest for seats on the Sunnyvale, Calif., company's board of directors. Microsoft this week leaked names of its candidates to The Wall Street Journal, which also reported that employees at the Redmond, Wash., company have expressed skepticism about the deal. In addition, the New York Post, citing unnamed sources, reported that Microsoft CEO Steven Ballmer could reach out to Yahoo! and say it would sweeten its $31 a share, $43 billion offer slightly if Yahoo! agrees to formal deal discussions.

"Obviously with all this being leaked it's going down to the wire," said Jeffrey Lindsay, an analyst with Sanford C. Bernstein & Co. "Microsoft's really trying to persuade Yahoo! to negotiate.

Continue reading at TechConfidential.com.

We've been digging around for the the coming layoffs at private equity firms to get a good handle on just what the economic downturn and credit crunch will mean to all the B-School kids who wanted to be the next multi-millionaires and billionaires. While no hard numbers are out industry-wide yet (at least that you can hang your hat on), there are some things trickling out.

The Deal Journal, of the Wall Street Journal, noted in a post today that American Capital Strategies (NASDAQ: ACAS) plans to let go an unspecified number of staffers in middle markets. As you can see in the chart below, they have had their fair share of pain in the process.


Dan Primack, of Private Equity Hub, also wrote a piece noting that no one is getting hired in finance anymore, so he linked to an M&A article about "how to get fired."

Our own Zac Bissonnette wrote here on BloggingBuyouts at the end of February about how M&A was down so much that dealmakers were set for big layoffs.

But here we are at the end of April and no major firings have come the way of dealmakers. Since they cannot all jump into "distressed mortgages and loans" and since they cannot all go to work for a SPAC immediately, it seems only a matter of time and that time is sooner rather than later.

The one thing you can bet on is that there won't be press releases out of private equity firms. They are private for a reason, well most are still private. When the news does come out it's probably safe to assume that the firms will say this is merely a reflection of the current conditions or something of the like. Just keep in mind that companies don't fire waves or groups of workers if they think they will be needed in a few months time.

Who knows, maybe they will just announce worker furloughs through the end of summer.

Morgan Stanley (NYSE: MS) looks like they are getting busy on the private equity side, while others are not.

The investment banking, brokerage, and private equity firm plans to launch a private equity unit in India May 1, using funds from its Asia-specific private equity fund for $1.5 billion that closed last year. Reuters has reported that the unit will be managed by Aluri Srinivasa Rao. Previously, he worked at ICICI Venture of ICICI Bank, India's No. 2 lender. Morgan Stanley already has an investment bank and an asset management firm in operation in India, and the private equity growth in India is a response to India's rapid economic growth and opportunities. The report also noted that The State Bank of India reportedly is in talks with multiple foreign firms to start private equity funds in India.

Morgan Stanley's real estate fund, Special Situations Fund III, completed its third offering in a report by MarketWatch raising $2.5 billion. Most funding came from foreign investors. The completion of this fund brings the total Special Situation funding to $5.9 billion.

Raising "funds" isn't necessarily the same as entering deals, but generally the latter follows suit for a portion of the funds.

Jon C. Ogg is the editor of the Special Situations newsletter for 247WallSt.com.

If you take Microsoft Corp. (NASDAQ: MSFT) CEO Steven Ballmer at his word, the company has no intentions of raising its current $31 a share, $43 billion offer to acquire Yahoo! Inc. (NASDAQ: YHOO). But those following the seemingly never-ending saga (and one that appears destined to continue indefinitely) still see a higher offer in Yahoo!'s future.

Yahoo!'s first-quarter earnings report on Tuesday in and of itself will not get Microsoft to increase its offer. But they do give the company some leverage if and when it chooses to enter into serious negotiations with Microsoft.

"The most feasible, logical combination is still Microsoft buying them; it just comes down to the last-minute negotiations and whether the first quarter and outsourcing search to Google (NASDAQ: GOOG) are enough of a trump card to raise the bid," said RBC Capital Markets analyst Ross Sandler. "Or Microsoft can choose not to and go hostile."

Continue reading at TechConfidential.com.

After Yahoo! Inc. (NASDAQ: YHOO) reports its first-quarter earnings tonight, stories will flow about how the numbers could alter the price Microsoft Corp. (NASDAQ: MSFT) may eventually pay to acquire the Internet portal.

Apparently Microsoft CEO Steven Ballmer won't be reading them. Speaking in Morocco on Tuesday, he said the results won't "affect the value of Yahoo! to Microsoft." Negotiating tactics? Of course. And Ballmer didn't say Microsoft wouldn't raise its offer no matter what.

Besides, the report could still sway Yahoo! shareholders, who must sign off on any deal and may hesitate in backing a takeover at Microsoft's standing offer of $31 a share, or $43 billion.

Continue reading at TechConfidential.com.

Mark Mobius, one that I consider a seer and leading pioneer among emerging market fund managers, has said he is in talks for private equity investment in Iraq. According to Reuters (and others), he is getting closer to plunking funds down into Iraq.

He said various small manufacturing and food companies that are worth looking at to provide investments. If Mobius invests in Iraq, his investment group will be one of a few companies to invest in Iraq projects since the U.S. invasion. One brave investor, Godvig-Capital Management, has a hedge fund called the Babylon Fund that focuses on Iraq.

Mr. Mobius manages approximately $40 billion in emerging market assets through Templeton Asset Management, a part of Franklin Resources Inc. (NYSE: BEN). He is in the process of developing a $300 million fund for emerging markets.

Mobius is the one who has been coined with the term "Invest when there's blood in the streets." Well, that means he sees many opportunities in Iraq.

Jon Ogg is a producer and editor of the Special Situation newsletter and the "10 Stocks Under $10" weekly newsletter for 247Wallst.com.

Who would have imagined that the Delta (NYSE: DAL) merger with Northwest (NYSE: NWA), which was announced yesterday, could be scuttled by a merger of Continental (NYSE: CAL) and United (NASDAQ: UAUA)?

Most Wall St. observers believed that the unions were the largest barrier to the Delta deal. The pilots have not given the marriage their imprimatur. The captains may be able to hurt the merger by threatening a strike which could shut down the new carrier. Regulatory questions could be the other roadblock, but, as Reuters points out, "While the U.S. Justice Department is expected to work carefully, the agency's track record on consolidation favors approval."

If the airlines can solve their labor issues, the merger, meant to offset the rise in fuel prices and fall in passenger revenue, is likely to happen.

Read the rest of the story at 24/7 Wall St.

Dubai International Capital and Chinese private equity First Eastern Investment Group have announced a new joint fund, China Dubai Capital.

The fund will focus on China's growing economy in sectors such as infrastructure, health care, and resources and will attempt to capitalize on the growing ties between the UAE and China. Companies with strong growth possibilities and the potential to eventually trade on Dubai national securities markets will be primary recipients of the fund. The first closing of the fund will tag at least $500 million and will close this May. By the final closing expected in October, the fund is expected to reach $1 billion.

First Eastern currently manages over $1.5 billion for direct Chinese investments and is the first Chinese financial company to be established in the Dubai International Financial Center. Dubai International Capital manages Jordan Dubai Capital, a $300 million fund, and plans to launch a fund focused on Saudi Arabia.

$100 per barrel oil is increasing the face amounts of funds being committed. As high oil prices remain, expect more and more from Middle Eastern private equity and sovereign wealth funds to buy up infrastructure projects. That's the new world.
If you think this is a big deal for private equity or sovereign wealth funds, check out the Dubai $54 billion proposed eco-project.

Following this Yahoo! Inc. (NASDAQ: YHOO) affair is like playing a very high-stakes game of Three Card Monte: Take your eyes off the lucky lady and, pfffft, you're cooked.

As paidContent reported yesterday and the Wall Street Journal confirmed this morning, Time Warner Inc. (NYSE: TWX) is talking with the Internet company about shipping AOL and a trunk full of cash to Yahoo! in exchange for a minority stake in the combined company and a chance to close the door on one of the dumbest mergers in recent memory. AOL would get a lifeline. Beyond escaping Microsoft Corp.'s (NASDAQ: MSFT) $42 billion headlock, in AOL Yahoo! would get what remains a premier player in internet advertising and a company that retains large online audiences for financial, entertainment and other content.

The hardest thing to figure here is what's happening on the other side of the deal, where Microsoft is reportedly lining up News Corp. (NYSE: NWS) for a joint bid for Yahoo!. Under that scenario, Yahoo! would be folded in with Microsoft's MSN portal and News Corp.'s MySpace unit in one mighty online ad-selling, application-bundling, social networking-ing company. That Microsoft CEO Steve Ballmer is thinking of climbing into business with News Corp.'s Rupert Murdoch (pictured) suggests just how worried the software giant is about losing Yahoo!. But Ballmer should think twice. Murdoch has a famously keen instinct for when to buy, sell or hold a business. His interest in unloading MySpace underscores that, with the rise of FaceBook and other social networks, the Web property's best days might be behind it.

Continue reading at TechConfidential.com.