Posts filed under “M&A”
The WSJ is reporting that the SEC is looking at specific Health Care takeovers that seemed to be tipped in advance to several big hedge funds. The chart (above) shows the extent and timing.
There are many legal reasons to have owned these names, but the issue here is whether or not the funds received material non public inside information about the takeovers from their “expert networks.” If that turns out to be the case — and so far, we do not know if it is — it would be problematic.
Are these so called expert networks nothing more than good old fashioned inside M&A information being exchanged for cash? If that was the case, there will likely be jail sentences . . .
Holdings Spiked Near Deal Time
JENNY STRASBURG, MICHAEL ROTHFELD, TOM MCGINTY and SUSAN PULLIAM
WSJ, December 2, 2010
The WSJ occasionally buries huge stories in its much less read weekend edition; recall the option backdating investigation in 2006. This past weekend was a classic example of this: “Federal authorities, capping a three-year investigation, are preparing insider-trading charges that could ensnare consultants, investment bankers, hedge-fund and mutual-fund traders, and analysts across the nation, according…Read More
Barron’s has some interesting data points on deal activity in 2010: • 1,701: volume of deals in the first half, about stable with the like period in 2009 • $362 billion: total value of deals in the first half • 8.7%: rise in first-half deal value from the 2009 period • $41.6 billion: value of…Read More
As a stark counterpoint to How Goldman Sachs Bagged Clients, I recall ever so fondly how Merrill Lynch bagged itself: With a Sept. 2006, top-of-the-market, $1.3 billion acquisition of sub-prime originator First Franklin from National City: First Franklin is one of the nation’s leading originators of non-prime residential mortgage loans through a wholesale network. [...] “This…Read More
Dump the dog, buy the thoroughbred: • Berkshire Buys Burlington Northern in Buffett’s Biggest Takeover (Bloomberg) • Buffett’s Berkshire Sells More Moody’s (Barron’s) Prior to the takeover, Berkshire owned 22.6% of Burlington Santa Fe. At the end of 2008, Berkshire held 48 million shares of Moody’s. Their stake is now down to 38 million shares,…Read More
Some of the emails that recently came to light — from prior to the Merrill acquisition closing — makes it pretty hard for the company to claim MAC — Material Adverse Condition. The email exchanges make clear it they had a pretty good idea about the lousy condition Merrill Lynch was in. To my read,…Read More
Huge Bloomberg article on BofA’s Merrill acquisition. My view is that the vast majority of all mega-mergers are unmitigated disasters. The one true exception seem seems to be Commodity mergers (especially Energy/Oil), where you increase reserves but cut admin overhead. As disastrous and expensive as the acquisition has been, the Bloomberg column argues it also…Read More