M&A activity is off to a strong start thus far in 2019, and we are finding attractive opportunities to deploy capital including the below newly announced transactions:
- Spark Therapeutics (ONCE-NASDAQ), which develops gene therapy products for genetic diseases, agreed to be acquired by Roche Holding for $114.50 cash per share, or about $5 billion.
- Ultimate Software Group (ULTI-NASDAQ), a cloud-based human resources software provider, agreed to be acquired by Hellman & Friedman Group for $331.50 cash per share, or about $11 billion.
- Scout24 AG (G24 GY-Frankfurt), a software company that specializes in the real estate and automotive sectors, agreed to be acquired by a group led by Blackstone for €46.00 cash per share, or about €6 billion.
In February, a number of deals were completed, while other deals made progress towards receiving regulatory and shareholder approvals, notably:
- Orbotech, Ltd. (ORBK-NASDAQ), a designer and manufacturer of optical components used in various technology applications, received Chinese SAMR antitrust approval, which was the final condition of its acquisition by KLA-Tencor. When the deal closed on February 20, Orbotech shareholders received $38.86 cash and 0.25 shares of KLATencor common stock, which valued the transaction at approximately $3 billion.
- Aspen Insurance Holdings (AHL-NYSE), which provides property and casualty insurance and reinsurance products, received the final clearances required to complete its acquisition by Apollo Global Holdings. Aspen shareholders received $42.75 cash per share, or about $3 billion when the deal closed on February 15.
- NxStage Medical, Inc. (NXTM-NASDAQ), a medical device company that develops kidney dialysis systems for use in patient homes, received antitrust clearance from the U.S. FTC after they agreed to divest NxStage’s bloodlines business. Fresenius Medical Care agreed to acquire NxStage for $30 cash per share, or about $2 billion in August 2017, and the deal closed on February 22.
- Twenty-First Century Fox (FOX-$50.16-NYSE) continued to make progress towards receiving the remaining regulatory approvals for its acquisition by Disney, including the approval by the Brazilian antitrust regulator, CADE at the end of February. The deal is expected to close in March, when Fox shareholders will receive $38 in cash and Disney stock, as well as 1 share of New Fox.
Thanks to a robust market place, we expect ongoing deal activity will provide further prospects to generate returns uncorrelated to the market.
Column by Gabelli Funds, written by Michael Gabelli