Technology

More Monday Acquisition Madness

The market has been flooded with news of mergers and acquisitions, and it doesn’t show any sign of stopping. In the most recent example, Apollo Global Management LLC (NYSE: APO) has announced that it will acquire OM Group Inc. (NYSE: OMG).

Under the terms of the deal, OM Group will be acquired for $34 per share, which represents a premium of roughly 28% compared to Friday’s closing price of $26.54.

In a separate transaction, Platform Specialty Products Corp. (NYSE: PAH) will acquire OM’s Electronic Chemicals and Photomasks businesses, from the Apollo Funds for a total cash consideration of $365 million. Platform believes there is a synergy opportunity in excess of $20 million over the next two years. After these secondary transactions, the Apollo Funds will own OM’s Magnetic Technologies, Battery Technologies and Advanced Organics businesses.

Joseph M. Scaminace, chairman and CEO of OM Group, commented on the acquisition:

Last year, we launched a comprehensive review of strategic alternatives, resulting in our Board of Directors unanimously concluding that this acquisition of the Company is the best course of action to maximize value for OM Group stockholders.

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He continued:

Our transformation over the past several years created an attractive portfolio of differentiated businesses with a strong foundation. The transactions we are announcing today will deliver significant and immediate cash value for our stockholders. The Apollo Funds and Platform add financial resources and global operating experience to support the execution of strategies driving the growth and competitiveness of these businesses over the long term.

Earlier on Monday, 24/7 Wall St. covered the Intel Corp. (NASDAQ: INTC) acquisition of Altera Corp. (NASDAQ: ALTR). The terms of the agreement broke down to an all-cash transaction with Intel buying Altera at $54 per share. The total value of the transaction is $16.7 billion. The deal has been unanimously approved by the boards of both Intel and Altera.

In February, Intel had made moves to acquire Altera with an offering price of what was said to be $58 per share. After that offer, both companies entered into a non-disclosure agreement. At that time, Intel reviewed Altera’s non-public information and then revised its offer to $54 per share.

All the merger interest seems to have been initially rekindled by the Broadcom Corp. (NASDAQ: BRCM) acquisition by Avago Technologies Ltd. (NASDAQ: AVGO). This deal was valued at $37 billion and is considered to be one of the largest tech acquisitions.

Monday morning, Apollo shares were down 0.3% at $22.13, in a 52-week trading range of $20.02 to $28.93. The stock has a consensus analyst price target of $26.17.

Shares of OM were up nearly 28% to $33.89. The consensus price target is $36.00 and the 52-week trading range is $21.87 to $34.18.

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