Mergers & Acquisitions: The Dealmaker's Journal articles from December 2008

Mergers & Acquisitions: The Dealmaker's Journal archives from December 2008

Niche Hunt.(Inside Word)
December 1, 2008... Byline: Ken MacFadyen Editor For our cover story this issue, senior reporter Avram Davis directed his attention to niche investing. Don't let the name fool you - niche companies make up roughly 80% of the businesses in the United States,...

Beltway Monitor.(Water Cooler)
December 1, 2008... Byline: Editorial Staff Deposit cap is no barrier for Wells deal For more proof that tough times are prompting regulators to get creative, look no further than the Federal Reserve Board's approval of Wells Fargo & Co.'s deal for Wachovia...

Polite Conversation: Politics take center stage as dealmakers and investors ponder what "change" will mean for M&A.(Water Cooler)
December 1, 2008... Byline: Editorial Staff "This is our chance to answer that call. This is our moment. This is our time - to put our people back to work and open doors of opportunity for our kids; to restore prosperity and promote the cause of peace; to...

Ticklish Forecasts; The volatility in the marketplace, be it oil prices, foreign exchange rates or other factors, has made due diligence a thorny process.(Round Up)
December 1, 2008... Byline: Ken MacFadyen Due diligence has never been easy, but never before has it been quite this hard. The volatility of the marketplace is forcing acquirers to take deeper dives into the treasury functions of targets in an attempt to...

Quick Hits from Mergers unleashed.(Round Up)(Brief article)
December 1, 2008... Byline: Editorial Staff Delta, Northwest Finalize Combination The Justice Department approved Delta Air Lines' $2.6 billion all-stock deal for Northwest Airlines, clearing the way for the carriers to merge. With the completion of the...

A Financial Services Growth Play? Debt collection may be one of the few bright spots in the financial services market, though dealmakers warn that risks exist.(Round Up)
December 1, 2008... Byline: Avram Davis While "bailout" could be considered a four-letter word in the debt collection business, the struggles of companies like GMAC, GE Capital and of course the GSE's Fannie Mae and Freddie Mac underscore the opportunity in...

Going Live; When urgency for a sale supersedes calculation, sellers will increasingly turn to a live auction.(Round Up)
December 1, 2008... Byline: Jonathan Marino Live auctions may work well for cattle, art and foreclosed homes, but corporate acquirers and PE investors tend to prefer a more relaxed setting for M&A. That is, of course, unless going down the public-sale path...

Reconsidering the 'Made in China' Brand? Dealmakers ponder how the product-safety issues facing the country will impact M&A.(Arla Foods Ingredients A.m.b.a to partner with China Mengniu Dairy Co. )
December 1, 2008... Byline: Ken MacFadyen When Scandinavian dairy producer Arla Foods entered into a partnership with China Mengniu Dairy Co. in the summer of 2005, the deal underscored the very theme behind the corporate flight to China. In addition to...

Cross-Border News from Mergers unleashed.(Global View)
December 1, 2008... Byline: Editorial Staff PNC Equity Partners Buys Orthotic Group PNC Equity Partners, the Pittsburgh middle market investor, acquired the Orthotic Group, which makes and sells orthotic footwear, gait analysis equipment and other...

Portfolio Patch Up; PE firms, after a three-year buying spree, are reassessing what they bought during the binge and figuring out how to preserve those investments.(LBO Watch)
December 1, 2008... Byline: Ken MacFadyen In mid-October, a slide-show prepared by Sequoia Capital was leaked to the press and immediately became a hit within the community of business blogs. Entitled "RIP Good Times," it was essentially a call to action...

Buyout Bits from Mergers unleashed.(Aqua-Chem Inc. to acquire Matrix Utilities Inc.)(Sterling Investment Partners to acquire FCX Performance Inc.)(Wellman Inc. to acquire J.H. Whitney & Co.)
December 1, 2008... Byline: Editorial Staff Sterling Acquires FCX Performance Sterling Investment Partners has completed the acquisition of FCX Performance, Inc., a U.S. specialty flow control distributor and solutions provider serving the industrial...

PE Pollyannas? There is reason for optimism in the LBO world, although history paints an ugly picture for 2006- and 2007-vintage funds.(LBO Watch)
December 1, 2008... Byline: Danielle Fugazy It's a cliche that traders love: buy low, sell high. For a two-year stretch starting in mid-2005, however, many private equity pros argued that great returns could be had through buying high so long as leverage...

On the Menu: Distress: Turnaround investors will have plenty of opportunities in the restaurant sector, though the unsettled real estate market adds nuance.(LBO Watch)
December 1, 2008... Byline: Jonathan Marino In a weak economy, it's the luxuries that tend to suffer the most. While some might debate that tag for the Bennigan's and Steak & Ale franchises, which had been jointly owned by the same parent, the bankruptcy of...

Placing Placement Agents; The turmoil on Wall Street will likely impact the fund placement business.(LBO Watch)
December 1, 2008... Byline: Avram Davis The placement agent business has always been a cyclical endeavor in the eyes of the global investment banks. When fundraising is up, they staff up, and when the market is dry, many bulge brackets will just as soon let...

The Squeeze on DIPs; The market for debtor-in-possession financing has contracted, but shorter DIPs may increase the possibility of a sale.(Debt Monitor)
December 1, 2008... Byline: Kelly Holman Debtor-in-possession financing is the credit equivalent of a life raft during difficult times. Louis Cappelli, chairman of Sterling National Bank, recalls a poignant moment when asked about the subject, retelling a...

Credit Wire from Mergers unleashed.(Debt Monitor)
December 1, 2008... Byline: Editorial Staff PNC To Acquire National City In the first consolidation to take advantage of the Treasury Department's capital-injection plan, PNC Financial Services Group has agreed to a $5 billion deal to buy National City....

Something Different; Distinction is critical in a market like this, making niche strategies all the more important.(Cover Story)
December 1, 2008... Byline: Avram Davis The middle market lives and dies on its ability to spot a niche. It's partly what keeps the smaller deal space churning while the larger realm remains more exposed to the whims of broader macroeconomic trends. But...

Combustible.(Roundtable)
December 1, 2008... The energy markets, over the past few months, proved that they are not immune to the travails of the economy. Lower crude prices, the woes of the credit market, and diminishing demand have conspired to sink oil prices, reflecting a pullback...

Money Card; American Greetings' loan-to-own play for its private rival could be the next big thing in hostility.(Feature)
December 1, 2008... Byline: Jonathan Marino American Greetings Corp.'s disclosure in October that it had bought $44 million in the first lien debt of privately held Recycled Paper Greetings came as a surprise: typically, listed companies aren't in the...

Breaking News; What's black and white and red all over? A bloodied newspaper industry facing a shortage of buyers.(Feature)
December 1, 2008... Byline: Jonathan Marino The shutdown of the New York Sun is not an isolated case. Newspapers in the US have been reduced to having to pinch pennies, as the print industry, as much as any other sector of the economy, is facing a downward...

Progress Delayed? It's always been hard for women to get their foot in the door in private equity; dealmakers are wondering if future advances will be slowed due to the credit downturn.(Feature)
December 1, 2008... Byline: Danielle Fugazy Sarah Bradley is among the small population of female investment bankers who was able to make the jump to private equity. She had spent five years as a banker at Deutsche Bank, most recently in the firm's sponsor...

Making Sense of the Middle Market: ACG Teamed up with Grant Thornton and NASDAQ for a discussion on their joint whitepaper: "Top Trends in Middle Market Private Equity".(Letter to Members)
December 1, 2008... Byline: Harris Smith and Gary A. LaBranche In mid-October, ACG joined Grant Thornton and NASDAQ for a panel discussion and Closing Bell Ceremony in support of their joint whitepaper, "Top Trends in Middle Market Private Equity." ...

A Tree Grows on Wall Street.(Profile)
December 1, 2008... Byline: Joshua Hamerman The supermarket model of investment banking died a very quick death this past fall. The future of the industry, many believe, will be fashioned after the boutiques - firms that focus on just a few key areas, but...

Remember the Titans; Brett Cole discusses his new book, M&A Titans, which looks back at the people who shaped the industry, and provides a model for future rainmakers.(Q&A)
December 1, 2008... Byline: Ken MacFadyen During the past few months, it has become clear that the investment banking model is going to change. One view, from Economist reporter and author Brett Cole, is that the industry will revert back to a time when...

Tax in a Down Market: A new market for M&A brings some new tax issues.(From the Field)
December 1, 2008... Byline: David H. Schnabel and Michael Bolotin Dealmakers guided by the old maxim that buyers prefer asset sales and sellers prefer stock sales may want to check their compass - bad markets have a way of turning common wisdom on its head....

Consolidation Shapes Job Market: Barclays and Bank of America realigned to accommodate their respective Lehman and Merrill deals, plus other people moves.(The Changing Scene)
December 1, 2008... Byline: Editorial Staff As consolidation grips the bulge bracket, the employment picture has cleared up a bit. Barclays, for instance, reworked its various industry investment banking groups naming former Lehman bankers as heads of 10 of...

A New Hand: Members discuss how they intend to capitalize on the market's volatility and the impending change in the White House.(The Pulse)
December 1, 2008... Byline: Editorial Staff Picture investment opportunities as waves on the ocean. It is hard to spot a small rise in the sea level while on the sea. It is only recognized by a majority, when it comes in close to land where it builds a wave...

Look North: Profits lie buried in the sands of Canadian oil fields.(Community Commentary)
December 1, 2008... Byline: Angel Mahmood As demand for oil in the United States continues to rise, prices remain high and the ability of energy producing nations to keep pace is uncertain. In the volatile oil marketplace there are few sure bets, and...

The Credit Puzzle: Deals are still getting done, but with a new focus.(Community Commentary)
December 1, 2008... Byline: Lou Banach and Jim Gettel During the past several months, uncertainty in the commercial credit markets has led to concern about whether mergers and acquisitions transactions can be accomplished successfully in today's...

Heading East? Set the Clocks Back: Dealmakers understand that execution takes longer in China, although many still underestimate the amount of time it takes to close a transaction.(Community Commentary)
December 1, 2008... Byline: Jason D. Ramey For over two decades, multinational companies have been heavily investing in China. Today, there are a significant number of small to middle market companies that are either considering expansion or they have new...

Water Cooler: What players in the mid market are talking about.(The Goldman Sachs Group Inc, New York Yankees, Dallas Cowboys and CIC partnets to partner with each other to launch New York Yankees)
December 1, 2008... Byline: Editorial Staff In search of a better wiener Goldman Sachs has already scored once betting on The New York Yankees. The firm, along with mid-market private equity group CIC Partners, is making another wager, teaming with both the...

Tomorrow's Deals: Taking stock of what dealmakers are looking at.(Water Cooler)
December 1, 2008... Byline: Editorial Staff InStorage prepares defense Following a hostile takeover bid, valued at C$3.75 per unit, Toronto-based InStorage REIT has tapped RBC and Brookfield Financial to help the company mount a defense. InStorage also...