Continue reading Texas Instruments Acquires National Semiconductor

Texas Instruments Acquires National Semiconductor originally appeared on BloggingStocks on Tue, 05 Apr 2011 09:00:00 EST. Please see our terms for use of feeds.

Charles Schwab (SCHW) has announced its decision to acquire optionsXpress (OXPS) in a friendly all-stock deal. This deal will help Schwab compete with other firms like E-Trade (ETFC), Ameritrade (AMTD), and Bank of America (BAC), which all have large online brokerage services and are vying to provide investors with the best tools and services.

The deal, which is expected to close by the third quarter of 2011, will cost Schwab $1 billion, and the company will issue 60 million new shares to swap each outstanding share of optionsXpress with 1.02 of its own shares. Our $19.74 price estimate for Charles Schwab is at a premium of almost 12% to its current market value.

Continue reading Chuck Adds optionsXpress to Schwab's Portfolio

Chuck Adds optionsXpress to Schwab's Portfolio originally appeared on BloggingStocks on Thu, 24 Mar 2011 09:10:00 EST. Please see our terms for use of feeds.

Option volume has ramped up today on KeyCorp (KEY), with activity rising well beyond the usual level on both the call and put side of the tape. Taking a closer look at some of the major block trades on this regional banking issue, it appears that a single spread strategist is responsible for a healthy portion of this option volume.

Specifically, the trader purchased a block of 10,000 June 10 calls for $0.50 each, and simultaneously sold 10,000 June 8 puts for $0.25 each. The result was a net debit of $0.25 per pair of contracts -- which means the speculator can begin collecting profits on those purchased calls if KEY rallies beyond $10.25 by June expiration.

Continue reading Buyout Buzz Inspires Bullish KeyCorp Spread

Buyout Buzz Inspires Bullish KeyCorp Spread originally appeared on BloggingStocks on Thu, 03 Mar 2011 17:00:00 EST. Please see our terms for use of feeds.

EchoStar (SATS) announced an agreement to acquire all of the outstanding equity of Hughes Communications (HUGH) in a transaction valued at approximately $2 billion. EchoStar overall option implied volatility of 29 is near its 26-week average of 31, according to Track Data, suggesting slightly lower price movement.

Emergency Medical Services (EMS) and Clayton, Dubilier & Rice announced a definitive merger agreement under which an affiliate of CD&R will acquire EMSC for $64.00 in cash for each share of EMSC Class A common stock and Class B common stock and each LP Exchangeable Unit. Overall option implied volatility of 16 is below its 26-week average of 32, according to Track Data, suggesting decreasing price movement.

Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: EchoStar Volatility Flat into $2B Acquisition of Hughes Communications originally appeared on BloggingStocks on Tue, 15 Feb 2011 09:15:00 EST. Please see our terms for use of feeds.

"Merger Fund (MERFX) offers a non-traditional way to invest, using merger arbitrage," says fund specialist Leonard Goodall.

The editor of No-Load Fund Portfolios explains, "Managers Green, Shannon and Behren focus on acquisitions. The success of the fund depends upon the skill of the managers to pick the mergers that will go through, along with a good measure of luck.

"They make us of the 'spread' -- buying shares in the target company after the acquisition is announced and selling those shares at a higher price when the deal is completed.

Continue reading Merger Fund (MERFX): Betting on Aquisitions

Merger Fund (MERFX): Betting on Aquisitions originally appeared on BloggingStocks on Wed, 02 Feb 2011 12:30:00 EST. Please see our terms for use of feeds.

Continue reading Chasing Value: Questions About Apple?

Chasing Value: Questions About Apple? originally appeared on BloggingStocks on Wed, 27 Oct 2010 13:30:00 EST. Please see our terms for use of feeds.

Rumor has it -- again -- that dot.bomb era survivor E*Trade (ETFC) may be acquired by none other than Charles Schwab Corp. (SCHW) for an initial offer of $24 a share. This chatter moved the stock price marginally Friday up 72 cents to $15.27. Although as of Monday morning the rumors are unsubstantiated, trading in stock options has heated up on the call side.

Bantering about the inevitable acquisition of E*Trade has been an annual pastime on and off for the past 10 years, but they resurfaced again in earnest after the financial crisis creamed most companies and institutions. E*Trade is currently capitalized at $3.37 billion. If the rumors bear fruit, the Schwab offer represents approximately a 60% premium to the current price.

Continue reading Chasing Value: E*Trade Schwab Buyout Rumors

Chasing Value: E*Trade Schwab Buyout Rumors originally appeared on BloggingStocks on Mon, 27 Sep 2010 09:30:00 EST. Please see our terms for use of feeds.

Continue reading Kraft Sells Pizza So It Can Buy Chocolate

Kraft Sells Pizza So It Can Buy Chocolate originally appeared on BloggingStocks on Tue, 05 Jan 2010 09:00:00 EST. Please see our terms for use of feeds.

Continue reading Buyout Capacity for Private Equity Biz Still Growing

Buyout Capacity for Private Equity Biz Still Growing originally appeared on BloggingStocks on Thu, 31 Dec 2009 13:40:00 EST. Please see our terms for use of feeds.

The fact that there hasn't been any action in a while doesn't mean there isn't room for more. Richard Anderson, CEO of Delta Airlines (DAL), says that the airline industry could consolidate further -- not exactly a shock in an industry that is known for universal financial suffering. He notes, "If a transaction were to occur, economics should prevail."

The only concern, of course, is whether the Obama administration would sign off on any future deals. Anderson believes, "I think the case can be made ultimately, but it remains to be seen what this administration's take will be."

Continue reading Delta: Plenty of room for airline industry consolidation

Delta: Plenty of room for airline industry consolidation originally appeared on BloggingStocks on Wed, 16 Dec 2009 11:30:00 EST. Please see our terms for use of feeds.

Two big reinsurers in Bermuda could be getting ready to tie the knot. Aspen Insurance Holdings (AHL) is said to be close to buying Ariel, which would be a multi-billion dollar merger.

According to Reinsurance magazine, the companies are "close to signing a merger agreement." None of the financial details have been disclosed yet, but the result would create the largest combined Bermuda and Lloyd's reinsurance operation on the island.

Continue reading Aspen Insurance has urge to merge, sets sights on Ariel

Aspen Insurance has urge to merge, sets sights on Ariel originally appeared on BloggingStocks on Sat, 28 Nov 2009 14:10:00 EST. Please see our terms for use of feeds.

Continue reading Serious Money: Questions as Buffett's money & mouth converge on BNI

Serious Money: Questions as Buffett's money & mouth converge on BNI originally appeared on BloggingStocks on Wed, 04 Nov 2009 14:40:00 EST. Please see our terms for use of feeds.

Up until the credit crisis, private equity firms had it made. They had plenty of leverage to play with and could load up their acquisition targets with it. So, they could realize a fantastic return on equity, mitigate their own risks, and show that they were the studs of the Street.

Then, all that went away. Credit markets dried up, and private equity companies lost their acquisition fuel. The numbers aren't as big as they used to be, but it looks like the private equity market is back in action.

Continue reading Private equity biz back in action

Private equity biz back in action originally appeared on BloggingStocks on Thu, 15 Oct 2009 11:00:00 EST. Please see our terms for use of feeds.

Twitter's much-hyped $100 million round of financing closed Friday, cementing the company's (illiquid) value at $1 billion, though Twitter itself would not confirm the amount. T. Rowe Price and Insight Venture Partners participated in the deal, as expected, which is believed to be a precursor to an eventual liquidity event -- such as an IPO or acquisition.

In a way, it feels like 1999, where you have investors rushing to invest in high-profile companies, despite the absence of revenue models. Yet, Twitter may not be as bad off as the traditional folks think, especially if the goal is an acquisition. The company does say that it's pursuing revenue via corporate accounts. But, it's been saying this for a while, and we haven't seen anything yet. Also, it's leaving open the possibility of running ads on the site, though this wouldn't happen within the next three months.

Continue reading Twitter closes new round -- what's next?

Twitter closes new round -- what's next? originally appeared on BloggingStocks on Sat, 26 Sep 2009 11:40:00 EST. Please see our terms for use of feeds.

Some people join wine-of-the-month clubs. There are plenty of other programs out there, too, where your credit card is hit every month, and your purchase is sent to you directly. If only such programs were available for Google (NASDAQ: GOOG). . . .

The company's CEO, Eric Schmidt, said Wednesday that Google plans to pick up a small company a month as a way to get its acquisition head back in the game. With the worst of the recession behind us, Google believes, this is a great way to get moving.

Continue reading Google's hungry, looking for a new company every month

Google's hungry, looking for a new company every month originally appeared on BloggingStocks on Thu, 24 Sep 2009 09:30:00 EST. Please see our terms for use of feeds.

Continue reading Will Kraft dump assets to sweeten the Cadbury bid?

Will Kraft dump assets to sweeten the Cadbury bid? originally appeared on BloggingStocks on Tue, 15 Sep 2009 16:40:00 EST. Please see our terms for use of feeds.

Mergers and acquisitions are hitting the headlines. Walt Disney Co. (NYSE: DIS) just bought Marvel Entertainment for $4 billion. The biggest one recently is the Kraft Foods (NYSE: KFT) bid for Cadbury's at $16.73 billon. It wasn't accepted, but that doesn't mean it won't eventually happen. And Hershey Co (NYSE: HSY) certainly isn't going sit idly by and watch what happens. It may have ideas of its own for Cadbury.

You may think these big deals have no connection to your stocks since you don't own them. But you're wrong. This M & A activity has a very positive influence on all stocks, directly and indirectly. The more mergers there are, the better the stock market will do.

Continue reading Comfort Zone Investing: M&A deals: Good for everybody

Comfort Zone Investing: M&A deals: Good for everybody originally appeared on BloggingStocks on Sat, 12 Sep 2009 10:30:00 EST. Please see our terms for use of feeds.

Mergers and acquisitions aren't delivering the fees that investment bankers used to enjoy, but fortunately, the money's coming from elsewhere. Data from Thomson Reuters reports a 29% increase in capital markets and M&A fees for the first time in more than a year. Share sales (e.g., rights offerings) were where dealmakers found the action. In the shrinking M&A space, Morgan Stanley (NYSE: MS) has taken the lead spot.

Since there are fewer banks in the marketplace than there were a year ago -- and they have less money -- the capital is starting to come from elsewhere. Because they aren't lending at their previous pace, companies are issuing bonds and equity to replenish their coffers. Pfizer (NYSE: PFE), for example, raked in more than $23 billion from the bond market to fund its acquisition of Wyeth (NYSE: WYE), and Roche nabbed Genentech with the help of a $30 billion debt issuance.

Continue reading M&A plunges, investment banks find money elsewhere

M&A plunges, investment banks find money elsewhere originally appeared on BloggingStocks on Fri, 26 Jun 2009 11:00:00 EST. Please see our terms for use of feeds.

Several years ago, I heard a presentation from Laurence Fink, the mastermind behind the asset management giant, BlackRock (NYSE: BLK). At the time, he gave some frank advice; that is, he warned that investors needed to be very cautious.

Of course, it was spot-on (and saved me lots of money). And, I'm sure Fink's investors also appreciated the counsel.

Well, this week BlackRock became the king of asset management because of its $13.5 billion acquisition of Barclays Global Investors (NYSE: BCS). In all, the assets under management will now amount to $2.8 trillion.

Continue reading BlackRock shells out lots of green for Barclays unit

BlackRock shells out lots of green for Barclays unit originally appeared on BloggingStocks on Sat, 13 Jun 2009 12:10:00 EST. Please see our terms for use of feeds.

With litigation, it seems that the winners are usually the attorneys. Perhaps this is one of the key reasons that Dow Chemical (NYSE: DOW) and Rohm and Haas Co (NYSE: ROH) agreed to come back to the table and find a way to strike a merger. If not, both parties were on a destructive path to an unpredictable trial.

Interestingly enough, the new terms of the deal reinstate the $78 purchase price, but, of course, there are some wrinkles. The Haas Family Trust and Paulson & Co. will get as much as $3 billion preferred stock in Dow. This will be a much-needed infusion of capital.

Continue reading Dow Chemical, Rohm & Haas make nice in a $15 billion deal

Dow Chemical, Rohm & Haas make nice in a $15 billion deal originally appeared on BloggingStocks on Tue, 10 Mar 2009 07:00:00 EST. Please see our terms for use of feeds.