Market Overview

Benzinga's M&A Chatter for Tuesday January 3, 2012


Here are the M&A deals and chatter for Tuesday January 3, 2012:

3M to Acquire the Office and Consumer Products Business of Avery Dennison Corp.

The Deal: 3M announced Tuesday that it has entered into a definitive agreement to acquire the Office and Consumer Products business of Avery Dennison (NYSE: AVY) for a total purchase price of $550 million in cash, subject to post-closing adjustments.

On a GAAP-reported basis, 3M estimates the acquisition will be approximately $0.06 dilutive to earnings per share in the first 12 months following closing. Excluding purchase accounting adjustments and anticipated integration expenses, 3M estimates the acquisition will be $0.03 accretive to earnings over the same period.

Avery Dennison shares rose 2.2% on 1.7 times the average daily volume. Shares traded in a range of $29.04 to $30.10 and closed at $29.31.

Sara Lee Acquires Tea Forté

The Deal: Sara Lee (NYSE: SLE) announced Tuesday it has acquired Tea Forté, a Massachusetts -based leader in the ultra-premium tea category, for an undisclosed sum. With this acquisition Sara Lee strengthens its expertise and presence in the fast-growing segment of luxury teas.

Earlier this year, Sara Lee announced its plans to divide the company into two publicly traded, pure-play entities: one focused on meats in North America and the other focused on the international coffee and tea market. The split is on track to occur during the first half of calendar year 2012.

Also, on Tuesday, Sara Lee announced it has completed the sale of the majority of its North American Foodservice coffee and tea operations to The J.M. Smucker Company (NYSE: SJM) in an all-cash transaction. The two companies have also entered into a licensing and support agreement to cooperatively develop liquid coffee technologies to drive long-term growth. The sale was originally announced in October, 2011.

Sara Lee shares fell 0.69% on slightly more than the average daily volume. Shares traded in a range of $18.79 to $19.10 and closed at $18.92.

Commercial Metals Company Says Icahn Offer too Low

The Offer: Carl Icahn has offered to purchase Commercial Metals Company (NYSE: CMC) for $15 per share.

Commercial Metals Company responded to the offer on Tuesday in a letter to shareholders. The letter urged shareholders to "REJECT Icahn's nominees for election to the Board of Directors and to NOT tender your shares into his offer".

Commercial Metals shares rose about 0.5% on just under the average daily volume. Shares traded in a range of $13.88 to $14.28 and closed at $13.91.

AT&T to Acquire Leap Wireless, MetroPCS

The Rumor: AT&T (NYSE: T) will purchase either Leap Wireless (NASDAQ: LEAP) or MetroPCS (NYSE: PCS) as a substitute deal after losing T-Mobile.

A continuation of last week's rumor. AT&T is looking for a new acquisition to replace T-Mobile and add badly needed wireless spectrum. Both of these stocks moved higher again today, with Leap rising 6.67% and MetroPCS up 8.18%. Shares of Leap Wireless traded in a range of $9.30 to $10.03 on twice the average daily volume, closing at $9.39. Shares of MetroPCS traded in a range of $8.86 to $9.51 on 1.75 times average daily volume, closing at $9.91.

Time Warner, Comcast to Acquire Cablevision Systems

The Rumor: Time Warner Cable (NYSE: TWC) or Comcast (NASDAQ: CMCSA) will purchase Cablevision Systems (NYSE: CVC) for $23 per share, according to Bloomberg. The Dolan family has been trying unsuccessfully to take the company private for the past 6 years.

Cablevision shares rose almost 4% on 1.30 times the average daily volume. Shares traded in a range of $14.57 to $15.04 and closed at $14.78.

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