M&A Activity, Merger Arbitrage, and Hostile Takeovers

How Google- Motorola Deal Came Together (DealBook)
It took less than seven weeks, but it became more expensive quickly.
From the first discussions in early July to a formal announcement on Aug. 15, Google moved swiftly this summer to secure a $12.5 billion takeover of Motorola Mobility, according to a filing submitted on Tuesday. The search giant, which was eager to own Motorola’s extensive patent portfolio, was also willing to pay up.

Sergey Brin

ConAgra Gives Ralcorp a Deadline to Accept Its Offer (DealBook)
After months of unsuccessfully trying to persuade Ralcorp to accept several takeover proposals, ConAgra on Tuesday set a Monday deadline for the food company to accept its $5.2 billion merger bid.
If Ralcorp does not begin deal talks by 5 p.m. that day, ConAgra will withdraw its $94-a-share all-cash offer.
Shares in Ralcorp plummeted 8.9 percent in after-hours trading Tuesday, to $77.60. They have consistently remained below ConAgra’s bid.

Jakks Pacific receives takeover bid from Oaktree Capital (LA Times)
Jakks Pacific Inc., the Malibu toy maker, has received a $544-million takeover bid from Oaktree Capital Management after the Los Angeles buyout firm failed to work out a friendly deal with the company.
In a letter to Jakks’ board Tuesday, Oaktree made an offer to take Jakks private for $20 a share in cash, a 25% premium on the toy maker’s closing stock price of $16 that day. The company said it had been trying to work out a deal with the company since March; Oaktree Funds owns about 4.9% of Jakks already, according to the Associated Press.

Avis Abandons Its Bid for Dollar Thrifty (DealBook)
The Avis Budget Group, which made an offer last year for Dollar Thrifty, is walking away from its bid, potentially paving the way for Hertz Global.
On Wednesday, Avis Budget announced in a filing that it is bowing out of the bidding process, citing current market conditions.
The decision comes less than a month after Dollar Thrifty called on Avis and Hertz to submit their “best and final” offers. At the time, Hertz had the superior bid, with a cash-and-stock offer valued at $1.91 billion — significantly higher than the Avis bid of about $1.55 billion.

Nestle Using Strong Franc in Takeovers Puts Mead Johnson in Play: Real M&A (Bloomberg)
Nestle SA (NESN) is turning to takeovers after more than $10 billion in stock repurchases failed to stem a decline in shareholder value. That may put Mead Johnson Nutrition Co. (MJN) in its sights.
Nestle, which spent 10 billion Swiss francs ($11.4 billion) on buybacks in the past 14 months, will stop buying shares and may instead pursue acquisitions, Chief Financial Officer James Singh said last month after the currency reached a record. The world’s largest food company lost 5.4 percent during the buyback period as its rivals gained. While Nestle’s revenue is projected to drop this year, the franc’s appreciation — the biggest of any major currency in the past year — is now making takeovers cheaper than ever, James Investment Research Inc. said.

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