January Closes on Busy Note for M&A

The last week of January saw multiple billion-dollar mergers and acquisition (M&A) deals. Notable deals include the potentially largest U.S. merger since 2016; another biotech acquisition from pharma firm, Sanofi; the German software megafirm, SAP, accelerating its cloud presence; and Blackstone Group leading a group to control 55% of Thomson Reuters' Financial & Risk (F&R) division.

• Last Monday, Paris-based Sanofi's (NYSE: SNY) $4.6-billion-dollar offer to purchase another rare-blood disease drug developer, Ablynx (NASDAQ: ABLX), outbid Novo Nordisk's previous $3.1-billion-dollar offer. Just last week, the French pharmaceutical company recently initiated an $11.6 billion acquisition of Bioverativ (NASDAQ: BIVV), the hemophilia drug maker. According to Chemical & Engineering News, Ablynx's heavy-chain only nanobodies create smaller-than-normal drugs, a feature Sanofi believes is a competitive advantage. Many of Ablynx's programs are awaiting FDA approvals throughout the year.
• Last Monday, Keurig Green Mountain, privatized and operated by JAB Holdings since 2015, the German conglomerate, created a merger with Dr. Pepper Snapple Group (NYSE: DPS) for $21 billion. The highly caffeinated beverage firm, which will be known as Keurig Dr. Pepper, will be majority owned by JAB, controlling some 87% of the combined companies. According to Forbes, Keurig Dr. Pepper's new CEO Bob Gamgort believes the merger will establish a consumer needs-focused firm that can unlock high growth potential from a hot and cold beverage platform.
• Kapstone Paper & Packaging (NYSE: KS) reached a definitive agreement with industry rival WestRock (NYSE: WRK) to be purchased for $3.54 billion this past Monday. The closing agreements between the two firms should come at the end of the second quarter 2018. WestRock's new acquisition bolsters its already growing market share within the packaging industry. The paper & packaging add-on should secure WestRock's role as a stronger competitor to International Paper Co. (NYSE: IP), the industry leader.
• Last Tuesday, The Blackstone Group (NYSE: BX) announced its largest transaction since the 2008 global financial crisis when it initiated the $17.8 billion ($20 billion total value including debt) purchase of Thomson Reuters' (NYSE: TRI) Financial & Risk (F&R) division. The F&R division includes Thomson Reuters' flagship information terminal system, Eikon. Thomson Reuters will retain 45% of the division, and the firm is looking forward to its partnership with such a strongly respected PE firm, given its difficulty to overcome lower client spending and increasing edge of competitors such as Bloomberg L.P.  Blackstone's capital investment is met by the Canada Pension Plan Investment Board and the sovereign wealth fund of Singapore, GIC.
  
• German software giant SAP purchased CallidusCloud (CALD) for $2.4 billion last Tuesday. CallidusCloud provides configure price quote (CPQ) and other sales management tools and services similar with Callidus' competitors, Salesforce, Oracle, and Microsoft. According to the Wall Street Journal – CIO Journal, SAP CEO Bil McDermott sees the strategic acquisition as a key part of the firm's innovative strategy to transform the front office alongside its pre-existing back office software.