bloggingbuyouts

With a market capitalization of $82 million, a $300 million buyout price would be a lot to pay for Playboy Enterprises (NYSE: PLA). But The New York Post reports that's the price the company is looking for as it quietly shops for a private equity firm interested in the flailing icon.

Keith J. Kelly reports that "Sources said the sellers are looking for far more than the company's market capitalization because that would ensure Hef has enough on hand to maintain his lavish lifestyle."

Waste Management, Inc. (NYSE:WMI) is switching around the merger game in the garbage and trash collection sector. The company has announced today that it has made a proposal to Republic Services, Inc.(NYSE: RSG) to acquire Republic for $34.00 per common share in cash.

The company said that its proposal represents a premium of approximately 22% over the closing price of Republic stock from before the offer was submitted. Waste management believes that its all-cash proposal offers a better value to Republic stockholders than the recently announced Republic-Allied Waste Industries, Inc. (NYSE: AW) transaction.

The company said its board is committed to maintaining an investment grade status and is committed to continuing its annual dividend of $1.08 per share.

Waste Management noted that the Republic-Allied merger agreement expressly contemplates alternative proposals from third parties and defines a process for Republic to respond to those proposals.

The company believes that a transaction with Republic would close early in 2009. Waste Management also noted that it believes all of the financing needed to complete the transaction will be available on satisfactory terms believes it will maintain its investment grade status on a combined basis.

You could imagine that this would definitely run into antitrust issues and would definitely require certain divestitures.

APP Pharmaceuticals Inc. (NASDAQ: APPX) is one of the more active pre-market stocks today. The surge in trading this morning is the result of an overseas buyout for some $23.00 cash per share, although shares are trading north of $23.00 because there are earn-out clauses could generate further premiums in the future.

German health-care giant Fresenius has agreed to acquire APP for $23.00 per share in a cash acquisition, and there is an earn-out option that would enable holders to receive up to an additional $6.00 per share if APP's financial results meet certain targets. The term may go out until 2011 for the extra cash, so this won't occur overnight.

This gives an implied merger price of about $3.7 billion up to $4.6 billion. So depending upon the earn-out and performance clause, investors will get either a 29% premium, or they will receive a buyout that could be as mush as 63% over the life of that term.

Continue reading at BioHealthInvestor.com for on the fly analysis, direction, and ramifications. You can also see how the unusual volume may continue after seeing the data at VSInvestor.com for the volume spike effect.

Invitrogen Corp. (NASDAQ: IVGN) has announced a $6.7 billion cash and stock acquisition for Applera's Applied Biosystems Group (NYSE: ABI). The breakdown is 45% percent in cash and 55% in stock.

Invitrogen Corp. will pay $38.00 per share between the cash and stock, compared to yesterday's close of $32.44 and compared to the $37.67 52-week high. After the deal closes, it sees fiscal and calendar year 2009 organic revenue growth in the mid-single digits.

The company says that the combined operations will have annual sales of $3.5 billion and is expected to be neutral to slightly accretive to Invitrogen's earnings per share the first year after close and significantly accretive in year two.

Continue reading the terms and condition implications at BioHealthInvestor.com.

United Rentals Inc. (NYSE: URI) has announced a major self tender offer this morning and is is seeing shares surge in pre-market trading. It isn't going private, but it is cleaning up its books and retiring a large portion of its common stock and preferred shares. It seems it is doing what the old private equity acquisition couldn't do.

The company has announced its plans to tender for up to 27,160,000 shares of common stock through a modified dutch auction. This will be at a price of not less than $22.00 and not greater than $25.00. Shares closed at $19.50 yesterday and its 52-week trading range is $14.83 to $34.98.

The number of shares to be repurchased in the tender offer represents approximately 31.4% of the total outstanding number of shares. If fully subscribed, the total purchase price for the common stock would be roughly $679 million. There is also the retirement of preferred shares outstanding as part of this deal, which ties into Apollo Investment Funds and the associated board members will resign from the board of directors as part of the transaction.

Continue reading the full details and analysis at 247WallSt.com.

HireRight, Inc. (NASDAQ: HIRE) is going private and shares are surging as a result. The company has entered into an agreement to be acquired by US Investigations Services, LLC, a Delaware limited liability company and Hercules Acquisition Corp. Under this buyback shares shall be canceled and converted automatically into the right to receive $15.60 in cash, without interest.

The merger is subject to regulatory approval and subject to shareholder approval. As far as how this compares to shareholders, HireRight's 52-week trading range is $8.00 to $15.15. Shares closed at $10.47 yesterday, giving this a near 50% premium. This stock has been public since last summer.

On last look with an hour to the open it looks like about 26,000 shares had traded hands and the last seen print was at $15.25.

Pier One Inc. (NYSE: PIR) has made an offer to acquire rival Cost Plus, Inc. (NASDAQ: CPWM). Cost Plus confirmed this today. Unfortunately, nether stock is reacting with anything resembling an overwhelming response. It may seem like a game changing deal on the surface.

As far as the terms before any dilution, this would have been a 31% premium for Cost Plus before any dilution metrics come into play. The buyout terms are for 0.6 shares of Pier One for each share of Cost Plus. When you factor in the share drop at Pier One, this looks like a resounding thud.

The problem is that Pier One shares have fallen and therefore lowered the potential buyout price compared to any cash offer buyout deal. With a 16% drop to $5.55 per Pier One share, this works out to a mere $3.33 for Cost Plus.

Continue reading the full summary and analysis from 247WallSt.com.

Jon C. Ogg

The J. M. Smucker Company (NYSE: SJM) and The Procter & Gamble Company (NYSE: PG) Folgers unit have confirmed yesterday's reports that the two companies are going to merge.

The Folgers coffee business was going to be spun-out of P&G already, and this will more quickly exact that transaction. Folgers will merge into The J. M. Smucker Company in an all-stock "reverse Morris Trust" transaction valued at approximately $3.3 billion. This number includes an estimated $350 million of Folgers debt.

As part of this transaction, Smucker is going to issue a one-time special dividend of $5.00 per share to current Smucker shareholders as of the record date ahead of this merger. Following the one-time dividend, P&G shareholders will receive approximately 53.5% of Smucker in a tax-free stock-for-stock merger.

Continue reading "Sweet Caffeine" at 247WallSt.com.

If you look at the trading of stock and options in Anheuser-Busch Companies Inc. (NYSE: BUD), you might think that a merger offer of some sort is going to be announced soon. This morning Reuters ran a piece about how Belgium's InBev is putting pressure on non-family shareholders to consider a $46 billion merger or risk being left in the cold in the global beer consolidation.

The article points to a $65.00 per share bid, although no formal offer has been made to the company, at least not publicly. The real winner here would be Warren Buffett's Berkshire Hathaway Inc. (NYSE: BRK/A, BRK/B) as his last holdings date shows Mr. Buffett holding more than 227 million shares with a current value of some $13 billion.

But if you look at trading over the last few hours, it seems that things are picking up on the bias of traders toward a deal being at least offered. The share volume is now almost 5 million shares, and the average daily volume is only 5.7 million shares.

If you want to read a quick on the fly options analysis, you can continue reading that full option analysis at Volume Spike (Vsinvestor.com). The volume spike was significant and impossible to ignore. Until word comes from either side, we'll chalk this up to speculation or rumors.

CNOOC Ltd. (NYSE: CEO) closed at $185.35. The Globe and Mail says long-held speculation that China is seeking to buy Canadian oil and gas companies resurfaced yesterday, as a Chinese newspaper (South China Morning Post) reported the China National Offshore Oil Corp (CNOOC) CEO may be looking to acquire Talisman Energy (NYSE: TLM).

CNOOC over all option implied volatility of 46 is near its 26-week average of 47 according to Track Data, suggesting non-directional risk.

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

The Blackstone Group L.P. (NYSE: BX) has reported earnings this morning, and the initial response is lower. The private equity giant posted a GAAP net loss of $246.7 million after items, and its "economic net income" was also a loss at -$93.6 million.

The company said that its total net reportable segment revenues were $32.3 million, driven down by declines in all business segments from $1.23 billion in 2007. Its GAAP revenues were $68.5 million.

Corporate Private Equity had negative first quarter revenues; Real Estate revenues down 94%; Marketable Alternative Asset Management down 81%; Financial Advisory Revenues decreased 24%

You can look through the entire release, but as the company noted, most business segments were indeed lower.

Interestingly enough, the company now has $113.53 billion in assets under management. It has also decided to make a dividend payment of $0.30.

Shares of Blackstone are down about 4% at $18.70 in pre-market trading.

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.

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.

According to a report from the Ernst & Young's quarterly US IPO Pipeline Report, IPO activity is flattening as companies are waiting and watching to market to make their move. While that observation is obvious as a heart attack, there are some rather good details that may lead to help determine good IPO's versus bad IPO's in that report.

In the first quarter of 2008, 90 IPOs sat in the pipeline, the same amount as the last quarter of 2007. New registration was stable across the quarters, but the slide is still downward sequentially. In January there were 10 while February and March saw only 6 and 7, respectively. While the amount the registrations represent grew this quarter compared to last, $16.8 billion up to $17.3 billion, the numbers slowed toward the end of the quarter. It seems pre-IPO companies are holding tight and watching the market.

As expected, first quarter 2008 weakened compared to the first quarter in 2007. In the first quarter of 2007, 103 deals waited in the pipeline compared to 90 in 2008. In 2007, the registrants represented $22.8 billion compared to $17.3 billion in 2007. The average deal size also dropped, down to $192 million from $221 million. The largest deal in 2007, The Blackstone Group L.P. (NYSE: BX) reached $4.0 billion while in first quarter 2008, the largest was American Water Works at $1.6 billion. Visa Inc. (NYSE: V) was left off because of an end of quarter and for size issues as 'one of a kind.' Companies are also sitting in the pipeline much longer, 163 days on average compared to 113 in 2007.

Technology takes up the bulk of the pipeline with 26 registrants and $3.3 billion in dollar amount, up from $2.8 in fourth quarter 2007. Technology attracts foreign issuers with four out of five foreign issuers in the technology sector. While technology went up first quarter 2008, oil and gas dropped 60% from $5.3 billion fourth quarter 2007 to $1.9 billion. Biotech accounts for a solid 12 registrants and pharmaceuticals tally 11. California leads on a state-to-state basis, filing 16.7% of the total filings at 15. Texas and New York followed with 11 and 8, respectively.

Also according to the report... Patience and confidence are likely to ebb by June, but if you're a good company with solid business plans, practices and proven results, opportunities still await you in the markets.

The stock of Wendy's International Inc. (NYSE: WEN) was looking pretty poor yesterday morning. The proposed buyout from Triarc Companies Inc. (NYSE: TRY), the investment arm of billionaire Norman Peltz, at the time valued Wendy's at a mere $26.775 a share in a deal that would marry the Arby's and Wendy's brands. Shares even traded down under $25 because of the discounting.

But today's action -- the stock is up over $27.50, a 4% gain -- is looking like a story of "Good News, Bad News, Good News" for investors. This was a huge score for Mr. Peltz and Triarc. The bad news is that Wendy's board of directors folded like the proverbial cheap suit, particularly for shareholders who have been buried since $30 to $40. But the other good news is that if you believe in Nelson Peltz & Friends, you are getting this as an all stock exchange and therefore you are getting to participate in the upside if they get this ship turned around.

I really expected the board of directors to hold out for $30 (you can read the full op-ed piece from right when the deal was announced). If Peltz would have gotten the Trian Acquisition I Corp. (AMEX: TUX) special purpose acquisition company (SPAC) involved, that $30 level could have probably been reached.

One thing that may also be helping shares today is a Goldman Sachs' analyst upgrade, although that was from a "Sell" to a "Neutral" so it shouldn't be anything to get excited about.

Shares of Wendy's are now up 4% at $27.50 and Triarc Companies Inc. (NYSE: TRY) are at $6.66, a nearly 3% gain from yesterday's close. At $6.66 and based on a 4.25 share conversion offer, that would value Wendy's at $28.305 as an end-game pricing. Wall Street is voting positively for Triarc so far, particularly as its shares had been under-performing by so much.

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