Market Overview

Benzinga's M&A Chatter for Tuesday January 10, 2012

The following are the M&A deals, rumors and chatter circulating on Wall Street for Tuesday January 10, 2012:

Fossil To Acquire Skagen Designs For $225 Million

The Deal:
Fossil (NASDAQ: FOSL) announced Tuesday that it has entered into an agreement to acquire Skagen Designs, Ltd. and certain of its international affiliates for approximately $225 million in cash, subject to a working capital adjustment, and 150,000 shares of Fossil, Inc. common stock. In addition, the sellers may receive up to 100,000 additional shares of Fossil common stock if Fossil's net sales of Skagen-branded products exceed certain thresholds. Skagen Designs, based in Reno, Nevada, manufactures, markets and distributes watches, jewelry, sunglasses and clocks. The acquisition, which is subject to certain conditions, including regulatory approval, is expected to be finalized in February 2012.

Fossil shares traded in a range of $78.10 to $81.38 Tuesday, on slightly more than the average daily volume. Fossil closed at $80.67, a gain of 2.14% for the day.

Knology Acquires Data Center Operator E Solutions for $13.8 Million

The Deal:
Knology (NASDAQ: KNOL) announced Tuesday that it has acquired E Solutions Corporation for $13.8 million in cash. E Solutions is a premiere provider of colocation and data center services, operating two state-of-the-art SAS 70 Type II certified data centers in Tampa, FL.

From a financial perspective, the transaction is immediately accretive to Knology on a levered free cash flow per share basis. Knology will be able to fully amortize the purchase price, resulting in tax benefits with an estimated net present value of $2.8 million. Including the tax benefits, the transaction is accretive on an EBITDA multiple valuation. Knology funded the acquisition with cash on hand.

Knology shares traded in a range of $14.41 to $14.55 Tuesday, on 80% of the average daily volume. Knology closed at $14.53, a gain of 1.54% for the day.

WebMD Announces Termination of Discussions Regarding Potential Corporate Transaction

The Decision:
WebMD (NASDAQ: WBMD) announced Tuesday that, in late 2011, the independent directors of its Board of Directors commenced a process to consider strategic

alternatives to enhance stockholder value. In connection with such process, the Board of Directors formed a Special Committee of independent directors, which was advised by independent financial and legal advisors. The Special Committee, with its advisers, had discussions with several potential acquirers of the Company. The Company allowed such potential acquirers to conduct a due diligence investigation of the Company's business. The Special Committee has terminated these discussions with potential acquirers and its process to review a potential sale of the Company.

WebMD Shares Plunged on the news, closing down 28% on 10 times the average daily volume. WebMD shares traded Tuesday in a range of $25.01 to $27.72 and closed at $26.25.

Yahoo to Acquire AOL

The Rumor:
Yahoo (NASDAQ: YHOO) to acquire AOL (NYSE: AOL) for $25 per share, according to sources. Yahoo needs new sources of acquisition, now that WebMD has dropped out of the running.

An AOL spokesperson told Benzinga: "Nothing new here, same rumors over the last 2 years, and they have no merit".

Yahoo shares traded in a range of $15.50 to $15.71 Tuesday, on about half the average daily volume. Yahoo closed at $15.51, a gain of 0.32% for the day.

AOL shares traded in a range of $16.24 to $16.79 Tuesday, on slightly more than the average daily volume, and closed flat for the day at $16.27.

Yahoo to Acquire Netflix

The Rumor:
Yahoo (NASDAQ: YHOO) to acquire Netflix (NASDAQ: NFLX).

This rumor surfaces every day now. After the announcement by WebMD that they are no longer an acquisition target, the Netflix rumor intensified and shares of the online streaming company rose as high as $101 in the pre-market. But an earlier downgrade at Bank of America won out over the rumor, and Netflix shares fell sharply.

Netflix shares traded in a range of $92.50 to $99.84 Tuesday, on about twice the average daily volume. Netflix closed at $95.83, a loss of 2.39% for the day.

US Steel to be Acquired

The Rumor:
US Steel (NYSE: X) may be in talks to be acquired, according to sources.

Takeover chatter in X last surfaced on December 13, with ThyssenKrupp the Rumored buyer at $35 per share. A US Steel spokesperson would not comment on the rumor.

US Steel shares traded Tuesday in a range of $26.96 to $27.77 on 60% of the average daily volume. US Steel closed at $27.29, a gain of 1.90% for the day.

Charles River Labs to be Acquired

The Rumor:
Charles River Labs (NYSE: CRL) to be acquired for as much as $40 per share, according to dealReporter.

Charles River Labs traded Tuesday in a range of $29.54 to $34.05 on 3 times the average daily volume and closed at $32.47, a gain of 17% for the day.

Walter Energy to be Acquired

The Rumor:
Walter Energy (NYSE: WLT) was rumored to be in talks to be acquired due to cancellation out of a Goldman Sachs conference. Turned out to be a scheduling conflict.

Walter Energy last appeared as the subject of takeover chatter on December 15, 2011. Rio Tinto (NYSE: RIO) and BHP Billiton (NYSE: BHP) were the suitors mentioned at that time.

Shares of Walter Energy traded Tuesday in a range of $56.87 to $59.50 on 1.7 times the average daily volume and closed at $57.44, a gain of 1% for the day.

CoreLogic Reviewing Bids

The Rumor:
CoreLogic (NYSE: CLGX) has narrowed down the list of potential bidders in an effort to find a buyer, according to dealReporter.

Back on August 29, 2011 the company announced it had hired Greenhill to explore possible options.

Shares of CoreLogic traded in a range of $12.98 to $13.46 Tuesday on about half the average daily volume and closed at $13.41, a gain of 3.55% for the day.

Dell to Acquire Raxspace

The Rumor:
Dell (NASDAQ: DELL) to acquire Raxspace (NYSE: RAX), according to sources.

Hearing chatter that Michael Dell is looking for acquisitions.

Shares of Raxspace traded in a range of $41.87 to $42.63 Tuesday on about half the average daily volume and closed at $13.41, a gain of 3.55% for the day.

David Einhorn to Take Large Stake in Best Buy

The Rumor:
Greenlight Capital's David Einhorn to take a large stake, perhaps 10%, in Best Buy (NYSE: BBY), according to sources.

A Best Buy spokesperson could not be reached for comment.

Best Buy shares traded Tuesday in a range of $24.39 to $24.96 on 1.4 times the average daily volume. Best Buy closed at $24.72, a gain of 0.41% for the day.

Sanofi to Acquire Regeneron

The Rumor:
Sanofi (NYSE: SNY) could acquire Regeneron (NASDAQ: REGN), as hinted by Jim Cramer on Mad Money

CEO Dr. Leonard S. Schleifer was interviewed by Cramer after announcing sales of macular degeneration drug Eylea totaled $24 million to $25 million in sales in the fourth quarter.

Shares of Regeneron traded in a range of $72.00 to $75.83 Tuesday on 4 times the average daily volume and closed at $74.44, a gain of 13.68% for the day.

Posted-In: Long Ideas News Short Ideas Rumors M&A After-Hours Center Movers Tech

 

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