Multiple Billion-Dollar Deals Lead Busy Week for M&A

​The past week saw many notable billion-dollar deals including a global consumer brands merger, Amazon's purchase of a video surveillance company, Verizon's merger with Straight Path Communications, government and aerospace semiconductor consolidation, and AmTrust Financials' plan to go private.  

• Last Monday, February 26th, HRG Group Inc. (NYSE: HRG), a holding company co-founded by former President George H.W. Bush, reached a definitive agreement to merge with Spectrum Brands, Inc. (NYSE: SPB) for $10 billion. HRG Group currently owns shares of Spectrum Brands as its principal holding. As a result of the transaction, HRG’s shareholders will effectively retain HRG’s interests in Spectrum Brands. The combined company merger is expected to officially close during the second quarter of 2018 and is subject to the customary closing conditions. 

 

• Last Tuesday February 27th, Amazon Inc. (NASDAQ: AMZN) announced it would acquire Santa-Monica, California-based Ring for $1.2 billion. According to Pitchbook, Ring had raised $443 million and was last valued at $760 million. The smart doorbell maker had previously engaged with Amazon through the e-commerce giant's Alexa Investment Fund. Amazon's strategic acquisition will expand its footprint within home security and in-house delivery services.

 

• On Wednesday, February 28th, Straight Path Communications (ASE: STRP), a subsidiary of IDT, completed its previously announced $3.1-billion-dollar merger with Waves Merger Sub I, Inc., a wholly owned and operated subsidiary of Verizon Communications (NYSE: VZ). Straight Path Communications currently holds a large portfolio of 39-GHz and 28-GHz wireless spectrum licenses.

 

• Last Thursday, March 1st, Microchip Technology (NASDAQ: MCHP) stated its intent to purchase Microsemi (NADAQ: MSCC) for $8.35 billion. Microsemi Corp. is the largest U.S. commercial supplier of aerospace and military semiconductors equipment. The California-based Microsemi Corp. has undergone multi-acquisition-driven growth during the past few years within its aerospace and defense, communications, and industrial data center sectors. J.P. Morgan, acting as Microchip's financial adviser, has committed $5.6 billion in financing for the proposed deal. The semiconductor industry has been seeing a lot of recent news involving consolidation - the highest profile event is the ongoing negotiations with Broadcom and Qualcomm's potential merger.

 

• AmTrust Financial Services (NASDAQ: AFSI) filed its SEC form 12-B 25 to officially make the transition from a publicly entity to a privately-held entity this past Thursday. The overall public-to-private deal is valued at $2.7 billion. The acquiring entity, Evergreen Parent L.P., is a private equity consortium of Stone Point Capital and the Karfunkel-Zyskind Family, the founding families of the New-York-based insurance company. According to Thomson Reuters, CEO Barry Zyskind, concerning the reasoning for the deal, stated, "As a private enterprise, we will be able to focus on long-term decisions, without the emphasis on short-term result."