Posts for Ticker ‘ACS’

Today’s Best Market Rumors (9/29/2009) (AMD)(GOOG)(AMGN)

newspaperUpdated throughout the day.

Update:  Xerox (XRX) may find that IBM (IBM) or HP (HPQ) outbid it for ACS (ACS)  (Barron’s)

Update:  Apple (AAPL) may be working on a touchscreen remote for an upcoming TV product.  (The Boy Genius Report)

Update: Sequenom (SQNM) is recovering some losses, perhaps due to rumors it may be sold (TheStreet)

Warner Music (WMG) may be near a licensing deal with Google’s (GOOG) YouTube. (WSJ)

Hedge fund manager John Paulson may try to merge CIT (CIT) with IndyMac Federal Bank (NYPost)

Cytokinetics (CYTK) continues to rise despite denying rumorsthat it may be bought by Amgen (AMGN) (DJ Newswires).

AMD (AMD) could be at riskfor bankruptcy. (MarketWatch)

Alexion Pharmaceuticals (ALXN) and Vertex Pharmaceuticals (VRTX) may be acquisition targets.  (The Deal)

Douglas A. McIntyre

Posted on: September 29, 2009 – 9:13 am in Rumors, , , , , , , , , , , , , ,

Media Digest 9/29/2009 Reuters, WSJ, NYTimes, FT, Bloomberg

newspaperReuters:   China may hold the key to a sanctions program against Iran.

Reuters:   The head of the AIG (AIG) unit that caused most of the firm’s losses is back in US.

Reuters:   The G20 has set up a long struggle over bank capital rules. Read More »

Posted on: September 29, 2009 – 4:05 am in Press Digest, , , , , , , , , , , , , , , ,

Big Stock Price Changes Of The Day (ACS)(XRX)(CALM)(GMTN)(ASPN)

According to Volume Spike Investor, these are the bigger movers of the day:

Aspect Medical (ASPN) up sharply on buy-out.

Cal-Maine (CALM) down on earnings (details).

Big moves in Xerox (XRX) and ACS (ACS) on M&A.

Gander Mountain (GMTN) goes private (details).

Douglas A. McIntyre

Posted on: September 28, 2009 – 8:37 am in Pre-Market Activity, , , , ,

Xerox (XRX) Overpays For ACS (ACS)

95129cDell (DELL) paid a price that it could not defend, at least financially, for Perot (PER) earlier this month. Xerox (XRX) has decided to follow Dell down the same road by paying an extraordinary premium for ASC (ACS), a business outsourcing operator. The price tag is $6.4 billion in cash and stock. Read More »

Posted on: September 28, 2009 – 7:16 am in Mergers and Buy Outs, , , ,

Early-Bird Analyst Upgrades & Downgrades (DKS, IDXX, MA, WIT, ACS, ADP, CHT, FMCN, NT, PTI, TSS)

These are some of the upgrades and downgrades we are seeing from Wall Street this Tuesday morning:

  • Dick’s Sporting Goods (DKS) Raised to Outperform at Baird.
  • IDEXX Laboratories (IDXX) Started as Buy at Piper Jaffray.
  • Mastercard (MA) Raised to Buy at Goldman Sachs.

Read More »

Posted on: August 19, 2008 – 6:32 am in Analyst Calls, , , , , , , , , , ,

H-P Confirms EDS Talks, Who’s Next? (EDS, HPQ, ACN, CSC, ACS, PER, UIS, ACXM, BE)

As traders look to the news covering whether or not Electronic Data Systems Corporation (NYSE: EDS), there was a release from Hewlett-Packard Co. (NYSE: HPQ) that confirmed the two companies were engaged in merger talks but there were no assurances that a deal could be reached. As a result, there are many other tech and IT-sourcing companies to look at that other players may take an interest in.  Keep in mind that many of these large tech companies do not want to be involved in being acquired and some of the companies will have stronger takeover provisions.  Everyone of these companies are different, yet all are in overlapping areas.  Here is a handful of names that could fall under that sort of tie-up if the deal comes to pass:

  • Accenture Ltd. (NYSE: ACN), although maybe too large;
  • CA, Inc. (NYSE: CA);
  • Computer Sciences Corp. (NYSE: CSC);
  • Affiliated Computer Services, (NYSE: ACS);
  • Perot Systems Corp. (NYSE: PER);
  • Unisys Corp. (NYSE: UIS);
  • Acxiom Corp. (NASDAQ: ACXM);
  • Bearingpoint, Inc. (NYSE: BE)…..

If we took the mid-point of the pricing at $12.5 Billion we would have a rough share price of $25.00 per share on EDS.  At that rough price, you would have a company that analysts expect to be priced at 18.2 times DEC-2008 earnings and 0.55-times revenue estimates.

Any such deal for EDS would likely have to come in the form of a friendly buyout.  This company doesn’t protect itself as hard as other companies, but Capital IQ does note the following tools the company has:

  • Removal of directors only for cause;
  • Board can change size of members;
  • Advanced Notice for director nominations;
  • Move by 50% of shareholders to remove directors;
  • Board Indemnification;
  • Blank Check Preferred Stock.

EDS is seemingly involved in more aspects of IT outsourcing and consulting than it isn’t.  Because of the rate that IT-workers come and go inside the Indian IT-outsourcing companies and because of laws restricting total foreign ownership in India, we did not include the public Indian-IT operations in this report 

You can join our open email distribution list to hear about other mergers, IPO’s, spin-offs, secondary offerings, and other special situations.

Jon C. Ogg
May 12, 2008

Posted on: May 12, 2008 – 3:17 pm in Mergers and Buy Outs, Rumors, Technology Companies, , , , , , , , ,

Top 10 Pre-Market Analyst Calls (ACS, AEP, CPN, CVX, CTXS, F, POT, SYMC, THC, WB)

These are not all of the analyst calls, but these are ten of the top calls affecting shares this morning:

  • Affiliated Computer Services (NYSE: ACS) Raised to Buy from Neutral at Goldman Sachs.
  • American Electric Power (NYSE: AEP) Raised to Buy from Neutral at Banc Of America.
  • Calpine (NYSE: CPN) cut to Hold at Jefferies & Co.
  • Chevron Corp. (NYSE: CVX) Raised to Buy from Neutral at Goldman Sachs.
  • Citrix Systems (NASDAQ: CTXS) Started as Overweight at Thomas Weisel.
  • Ford (NYSE: F) Raised to Hold from Sell at Citigroup.
  • Potash Corp. of Saskatchewan (NYSE: POT) cut to Outperform from top Pick at RBC Capital Markets.
  • Symantec (NASDAQ: SYMC) Cut to Market Perform at Morgan Keegan.
  • Tenet Healthcare (NYSE: THC) cut to Hold at Deutsche Bank.
  • Wachovia (NYSE: WB) Raised to Buy from Hold at Deutsche Bank.

Jon C. Ogg
April 29, 2008

Posted on: April 29, 2008 – 6:39 am in Analyst Calls, , , , , , , , , ,

Top 10 Pre-Market Analyst Calls (ACS, DOX, BBBY, ESRX, HD, LOW, NWA, RFMD, SHLD, UA, ADP, BE, CSC, PAYX, SAPE, HEW)

These are not the only key analyst calls that may impact stocks this Monday, but these are the ones that 24/7 Wall St. is focusing on:

  • Affiliated Computer (ACS) raised to Buy from Neutral at UBS.
  • Amdocs (DOX) raised to Buy from Neutral at UBS.
  • Bed Bath & Beyond (BBBY) raised to Outperform from Neutral at Credit Suisse.
  • Express Scripts (ESRX) downgraded to Neutral from Overweight at JP Morgan.
  • Home Depot (HD) & Lowe’s (LOW) both raised to Outperform from Neutral at Credit Suisse.
  • Northwest Airlines (NWA) raised to Outperform from Neutral at Credit Suisse.
  • RF Micro Device (RFMD)raised to Buy from Hold at Deutsche Bank.
  • Sears Holdings (SHLD) downgraded to Underperform from Outperform at Credit Suisse.
  • Under Armour (UA) raised to Buy from Hold at Citigroup.

UBS Downgrades IT and Outsourcing/Business Process sector:

  • Automatic Data (ADP), BearingPoint (BE), Computer Sciences Corp. (CSC), Paychex (PAYX), and Sapient (SAPE) were all downgraded from BUY to NEUTRAL;
  • Hewitt Associates (HEW) downgraded from Neutral to Sell.

Jon C. Ogg
January 14, 2008

Posted on: January 14, 2008 – 7:36 am in Analyst Calls, , , , , , , , , , , , , , , ,

Other In-Trouble Mergers After Affiliated Computer (ACS, TRB, CMLS, GCO, PPH, FINL, BX, COMS)

Yesterday morning 24/7 Wall St. covered how the buyout for Affiliated Computer Services (NYSE:ACS) was for all practical purposes looking like toast, and we wanted to see which other pending deals were at risk.  A much more detailed review went to our free email newsletter subscribers yesterday morning, and all of these spreads have widened out today.  The news from last night confirmed this buyout was dead and today the Chairman received notice that the independent directors would leave their posts as per his demands.

But there are many other mergers out there that have misleading merger-arb spreads that are indicative of potential trouble as far as a closing at all or at least a risk of the stated merger price being sent to a reduced buyout price. Almost all of these mergers are different than the ones from September that we deemed at risk.

Tribune (NYSE:TRB) $34 buyout from Sam Zell and employees….
Shares reached almost $30.50 yesterday and today’s $29.90 is representative of a 13.7% merger-arb spread for a merger that shareholders have already approved.  24/7 Wall St. has given our own prediction for a buyout price that Sam Zell would likely offer if financing gets tight in this LBO-OPM (leverage buyout, other peoples money) offer.  We are looking at updating this in our New Media/Old Media subscriber letter next week.

PHH Corp. (NYSE:PHH) $31.50 buyout……
With a near-50% merger-arb spread consider this one toast or revised far lower or maybe only even by one of the buyout partners.  The Blackstone (NYSE:BX) buyout is supposedly to be revisited momentarily, although JPMorgan and Lehman that were financing a portion of the deal have (as of last look) maintained a $750 million shortfall on the debt portion here.  General Electric (NYSE:GE) was Blackstone’s buyout partner and the deal as originally intended was going to send the fleet services group (corporate car and truck fleets) to GE and the mortgage business to Blackstone. 

Genesco (NYSE:GCO) $54.50 buyout……
The $1.5 billion footwear acquisition that had been agreed to in June was scheduled to close last month, but would-be acquirer Finish Line (NASDAQ:FINL) and investment bank UBS stalled on the deal because of concerns over Genesco’s financial performance after the $54.50 buyout deal was announced.  At $45.40 there is a 20% merger-arb spread.  24/7 Wall St.’s belief is that Finish Line is in no position to do the deal whether it "states uncomfort and concerns" or not.

3Com (NASDAQ:COMS) $5.30 buyout…..
3Com’s buyout is not at risk over shareholder revolts nor over financing.  This one is at risk over China’s Huawei holding a stake after the Bain Capital buyout over "national security concerns" because many US and partner government agencies still relying on 3Com’s communication equipment. Senators are reviewing the deal and saber rattling here.  Boy, those must be some old systems.  24/7 Wall St. is reviewing this one now for the Special Situation Investing Newsletter since at $4.86 this has only a 9% merger arb-spread for an at-risk deal on a company that management can’t fix on its own.

Cumulus Media (NASDAQ:CMLS) $11.75 management-led buyout…..
The $1.3 Billion MBO agreement announced on July 23, 2007 has been a quiet one.  When announced this was almost a 40% premium.  At $10.12 today, there is still a 16% merger-arb spread.  The Board of Directors approved the deal and recommended that shareholders vote for it, but the financing from Merrill Lynch Global Private Equity and Merrill Lynch Capital Corporation "could" be up for interpretation.  Jim Cramer actually called this a takeover candidate before the MBO was announced.  Cumulus is also a name 24/7 Wall St. has under review for its New Media Old Media subscriber newsletter.

Jon C. Ogg
November 1, 2007

Jon Ogg produces the subscriber-based Special Situation Investing Newsletter where we cover buyout candidates, restructurings, spin-offs, and more.  We recently issued our "Small Cap Internet Watch List" PART 1 of 2 that showed a list of smaller web related properties we think could be acquired under the right circumstances, and we even listed which predator companies could or would acquire them under the right circumstances.

Posted on: November 1, 2007 – 2:44 pm in Mergers and Buy Outs, Private Equity, , , , , , , , ,

Affiliated Computer Services: Another Private Equity Deal Bites The Dust (ACS)

Private equity firm Cerberus has terminated its acquisition offer to acquire Affiliated Computer Services Inc. (NYSE:ACS).  This was a $6.2 Billion deal that valued Affiliated at $62 per share.

Cerberus did not blame the company for "material business changes" here like the weasel efforts of some competitor deals that have been called off.  According to the WSJ, the reason here is because of continuing poor conditions in the credit markets.  In other words, "we can’t finance the debt portion of the buyout."  Cerberus’ offer was made in March as a partial management-led buyout with founder Darwin Deason whom already owned some 42% of the company.

But the group does blame the special committee for taking to long in its search for a potential higher offer, because the group is reported to have said that it is confident the deal would have closed had the schedule proposed been adhered to.

The truth is that shares were trading under $51 yesterday, so this was already on the ropes.  The WSJ is also reporting that the two largest shareholders are unhappy about the board’s actions (or inaction), and the word from Pzena Investment Management according to the WSJ was "I don’t know why the board didn’t respond to us. They were radio silent."

Affiliated Computer is indicated lower, although it is still too early to tell the exact indications.  If you are a board member at Affiliated Computer that was in that special committee, it’s probably a good time to start finding out how much personal insurance you have protecting you from shareholder lawsuits.

Acxiom faced a similar drop.

Carl Icahn is going after BEA Systems over the board being childish.

Cablevision’s deal from the Dolan’s being called off was more the fault of holders.

Jon C. Ogg
October 31, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he produces the Special Situation Investing Newsletter and does not own securities in the companies he covers.

Posted on: October 31, 2007 – 5:58 am in Mergers and Buy Outs, Private Equity,

Media Digest 10/31/2007 Reuters, WSJ, NYTimes, FT, Barron’s

According to Reuters, a number of experts do not believe that a rate cut by the Fed will help the falling housing market.

Reuters writes that Alcatel-Lucent (ALU) will cut another 4,000 jobs.

Reuters reports that the UAW takes with Ford (F) have hit an intense phase.

Reuters also reports that Dell (DELL) has filed amended financials and will begin its share buy-back.

The Wall Street Journal reports that Google (GOOG) is in talks with Verizon (VZ) and Sprint (S) about offering a news phone loaded with the search company’s mobile software.

The Wall Street Journal writes that Stan O’Neal left Merrill Lynch (MER) with a $162 million exit package.

The Wall Street Journal reports that oil experts are discussing the possible effects of oil going well above $100 a barrel.

The Wall Street Journal writes the Cerberus has dropped its bid for Affiliated Computer Services (ACS).

The Wall Street Journal writes that experts are questioning if Citigroup (C) should account for structured investment vehicles on their own balance sheets.

The New York Times writes that pharmaceutical ingredients exported from China are often made by firms that are not certified.

The FT writes that Congress has extended the internet tax ban.

Barron’s writes that shares in Shutterfly (SFLY) dropped on a weak forecast for the next quarter.

CNN Money reports that Google (GOOG) and several social networks will offer a platform for applications that will run on any social networking site. The move is seen as a challenge to Facebook.

Douglas A. McIntyre

Posted on: October 31, 2007 – 3:14 am in Press Digest, , , , , , , , , ,

Pending Merger Arb Spreads Remain (Part 1) (ACS, URI, FDC, CCU)

There are still over 150 pending mergers out there that have not yet closed.  After the Fed’s recent actions, there are still some deals out there that are perceived to be at risk as far as the deals closing or if the deals can close at the announced buyout price. Some of these spreads have tightened in merger-arb scenarios, but there are quite wide spreads on many pending deals.  We have included most of the proposed closing prices or what discount the pending deals are to the actual price. 

We’ll be sending out a few selected deals we expect to go through without issue before Labor Day to our Special Situation Investing Newsletter subscribers.  Here is a partial list of some of the larger mergers out there that are still pending, and the total consideration pending here out of all the names we are covering today is more than $175 Billion:

The MBO of Affiliated Computer Services (NYSE:ACS) for some $8.2 Billion is also though of at risk or at least at the original terms because of the debt involved.  Chairman & founder Darwin Deason partnered with Cerberus Capital Management to offer $59.25 per share back in March, and shares at $49.90 are only 10% above 52-week lows and are roughly at a 16% discount to the acquisition price.

The buyout of United Rentals (NYSE:URI) by Cerberus at $34.50/share is seeing shares trade at $30.60 mid-morning, has a merger-arb spread of roughly 11%.  United Rentals is a municipal infrastructure player that is viewed to still have value on its own, and shares traded close to $40.00 on their own back in early 2006.

This $26 Billion buyout of First Data (NYSE:FDC) from KKR has been one of the cornerstone mergers that the skeptics are watching to see how strong deals can remain. The huge size of the deal makes it an esy one to target for being at risk, even though shareholders have already approved the buyout.  The $34.00 buyout price was looking at risk last week when shares dipped to under $30.50, but now shares are at $31.85.  That is still north of a 6% premium today.

Clear Channel (CCU) is one of those long-term at risk mergers that hasbeen ongoing.  The buyout price led by Bain Capital and Thomas H. Lee Partners LP for $39.20 is still well above today’s $35.40price.  Its shareholder vote is scheduled for September 25.

Jon C. Ogg
August 20, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 20, 2007 – 1:05 pm in Mergers and Buy Outs, , , ,