2011 Transaction Termination Fee Study

Transcription

2011 Transaction Termination Fee Study
MERGERS & ACQUISITIONS
CAPITAL MARKETS
FINANCIAL RESTRUCTURING
FINANCIAL ADVISORY SERVICES
HL.com
June 2012
2011 Transaction
Termination Fee
Study
Table of Contents
Page
2011 Transaction Termination Fee Study Summary
2
2011 Transaction Termination Fee Detail
25
2011 Reverse Transaction Termination Fee Detail
35
About Houlihan Lokey
40
Disclaimer
42
1
2011 Transaction Termination Fee Study Summary
2011 Transaction
Termination Fee
Study Summary
Introduction
Houlihan Lokey’s 2011 Transaction Termination Fee Study (2011 Study) employs search and screening
criteria similar to those used in previous studies. We applied these criteria to the universe of announced
transactions in 2008, 2009, 2010 and 2011 to provide a basis for comparison. In the past, our studies
f
focused
d on termination
t
i ti
f
fees
solely
l l as a percentage
t
off “transaction
“t
ti
value”
l ” (i.e.,
(i
th total
the
t t l value
l
off
consideration paid by an acquirer, excluding fees and expenses). For the most part, transaction value is
generally tantamount to “equity value.” We have also analyzed termination fee as a percentage of target
enterprise value to reflect the judicial recognition of “enterprise value” as a benchmark for assessing
acceptable termination fee levels in certain cases. Enterprise value is defined as the number of shares
outstanding multiplied by the per share offer price, plus the cost to acquire convertible securities, debt and
preferred
f
d equity,
i and
d minus
i
cash
h and
d marketable
k bl securities.
ii
We conducted our search using data from Thomson Reuters and applied the following screening criteria:
 Target company is a U.S. public company.
 Transaction announcement date is between January 1, 2011 and December 31, 2011.
 Transaction value is greater than $50 million.
 Transaction type, as classified by Thomson Reuters, comprises
 acquisitions of full, majority or remaining interest;
 leveraged buyouts; and
 tender offers (bankruptcy, divestiture and spin-off transactions are excluded).
 Deal status is completed, pending or withdrawn.
 Target termination fee is disclosed.
For the 2011 Study, 166 transactions met these criteria. We have analyzed these transactions in terms of
both transaction and enterprise values.
3
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees
Given the time and expense involved in negotiating and structuring a proposed transaction, acquirers are
continuously looking for creative ways to deter competing bids before the consummation of a transaction.
Protective devices used byy acquirers
q
are heavilyy negotiated
g
and mayy include termination fees,, “lockup”
p
agreements and “no-shop” provisions. Conversely, in seeking to maximize stockholder value, boards of
directors of target companies try to obligate the acquirer to consummate the agreed-upon transaction
while maintaining the flexibility to seek and accept a superior offer for the target.
Termination, or breakup, fees are probably the most common type of lockup device and are typically
payable by the target to the acquirer to compensate the acquirer if the transaction fails to close because,
because
among other things:
 The target board elects to terminate the acquisition agreement in order to accept a competing offer;
 The target board changes its recommendation and the acquirer elects to terminate the merger agreement
rather than proceed with the stockholder vote; or
 The original bid fails for some other specified reason, such as being voted down by the stockholders,
after a competing proposal has been announced and is agreed to or closed within a specified period
(typically six to 12 months).
Properly crafted, a termination fee provision can facilitate the sale of a company by ensuring that the
bidder will receive a material “consolation prize” to defray its investment—in time, out-of-pocket expense
and opportunity cost—if the transaction is not consummated. On the other hand, termination fees protect
the acquirer by effectively increasing the price that a third-party bidder will need to pay in order to
consummate a competing transaction.
4
2011 Transaction
Termination Fee
Study Summary
Enterprise and Transaction Values
Of the 166 transactions reviewed in 2011, the mean transaction value equaled approximately $2.2 billion, a 68.3% increase from
the 2010 mean transaction value of $1.3 billion. The mean enterprise value equaled approximately $2.9 billion, up 79.5% from
the 2010 mean enterprise value of $1.6
$1 6 billion.
billion
The median transaction value in 2011 equaled $571.4 million, a 36.2% increase from the 2010 median transaction value of
$419.6 million. The median enterprise value equaled $673.5 million, which was 41.6% higher than the 2010 median enterprise
value of $475.5 million.
Enterprise and Transaction Value Annual Summary
($ in millions)
Enterprise Value(1)
Transaction Value
Mean
Median
No. of
Transactions
2011
2010
2009
2008
2011
2010
2009
2008
$
$2,238.0
$
$1,329.7
$
$2,746.6
$
$1,852.8
$
$2,865.5
$
$1,596.2
$
$3,216.8
$
$2,287.9
$571.4
$419.6
$300.0
$263.0
$673.5
$475.5
$360.4
$355.4
166
184
99
146
153
159
95
129
Source: Thomson Reuters.
(1) Excludes banks and other financial institutions due to lack of reliable data.
5
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees - Transaction Value
In the 2011 Study, termination fees as a percentage of transaction value ranged from 1.1% to 7.7%, with a
mean of 3.3% and a median of 3.2%.
 The 1.1%
1 1% termination fee was observed in the $208 million acquisition of Express-1
Express 1 Expedited
Solutions by an investor group led by Jacobs Private Equity LLC.
 The 7.7% termination fee was observed in Kirby Corp.’s $156 million acquisition of K-Sea
Transportation Partners L.P.
The median termination fees as a percentage of transaction value for deals announced in 2011 fell slightly
compared to 2010 levels.
Transaction Termination Fees as a Percentage of
Transaction Value
2011
2010
2009
2008
Mean
3.3%
3.5%
3.5%
3.4%
Median
3.2%
3.3%
3.4%
3.3%
6
Transaction Termination Fees - Transaction Value (cont.)
The distribution of termination fees as a percentage of transaction value generally resembles a classic bell
curve, with most results clustered around the observed mean (3.3%) and median (3.2%).
Distribution of Termination Fee Percentages
35.0%
Peercentage of Tottal Transactions
2011 Transaction
Termination Fee
Study Summary
30.0%
25.0%
2008
20.0%
2009
2010
15.0%
2011
10.0%
5 0%
5.0%
0.0%
< 1.0%
1.0%2.0%
2.0%2.5%
2.5%3.0%
3.0%3.5%
3.5%4.0%
4.0%5.0%
> 5.0%
Termination Fee as a Percentage of Transaction Value
7
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees - Enterprise Value
Termination fees as a percentage of enterprise value were analyzed for deals announced from 2008 through 2011. Due to the
inclusion of debt, the enterprise value (the denominator in the fee percentage calculation) is typically greater than transaction
value.
l
A
Accordingly,
di l the
h observed
b
d median
di
termination
i i
f
fees
b d on enterprise
based
i value
l
off 3.2%
3 2% and
d 3.1%
3 1% in
i 2009 and
d 2011,
2011
respectively, are slightly lower than that observed (3.4% in 2009 and 3.2% in 2011) using transaction values. In 2008 and 2010,
the median termination fees as a percentage of enterprise value were equivalent to the observed median using transaction values.
Transaction Termination Fees as a Percentage of
Enterprise Value (1)
2011
2010
2009
2008
Mean
3 2%
3.2%
3 4%
3.4%
3 6%
3.6%
3 8%
3.8%
Median
3.1%
3.3%
3.2%
3.3%
8
Transaction Termination Fees - Enterprise Value (cont.)
The distribution of termination fees as a percentage of enterprise value appears to be slightly weighted
toward fees (as a percentage of enterprise value) at and above the mean (3.2%) and median (3.1%).
Distribution of Termination Fee Percentages
25.0%
Percentage of T
Total Transactio
ons
2011 Transaction
Termination Fee
Study Summary
20.0%
2008
15.0%
2009
2010
10.0%
2011
5.0%
0 0%
0.0%
< 1.0% 1.0%2.0%
2.0%2.5%
2.5%3.0%
3.0%3.5%
3.5%4.0%
4.0%- > 5.0%
5.0%
Termination Fee as a Percentage of Enterprise Value
9
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees – Semi-Annual Summary
The number of transactions announced decreased dramatically in the second half of 2011. The median size
of transactions throughout 2011 remained below the median transaction and enterprise values observed in
2007 ($790.6 million and $1.1 billion, respectively), but continued to exceed the values observed during
the recession.
In dollar terms, the median termination fee increased from $17.5 million in the first half of 2011 to $24.9
million in the second half of 2011, reflecting an increase in the size of observed deals (e.g., median
transaction value increased from $497.9 million to $761.8 million). The median termination fee decreased
slightly
li h l as a percentage off transaction
i value,
l
b increased
but
i
d slightly
li h l as a percentage off enterprise
i value
l in
i
the second half of 2011.
2011 Termination Fee Summary
($ in millions)
First Half of 2011
No. of Transactions
Second Half of 2011
103
63
Median Transaction Value
$497.9
$761.8
Median Enterprise Value (1)
$647.0
$706.0
Median Termination Fee
$17.5
$24.9
Median Fee as a Percentage of Transaction Value
3.3%
3.1%
Median Fee as a Percentage of Enterprise Value (1)
3.0%
3.1%
10
2011 Transaction
Termination Fee
Study Summary
Termination Fees by Transaction Size - Transaction
Value
In the 2011 Study, 64 deals had transaction values greater than $1 billion, compared with 54 in 2010. These billion-dollar
transactions accounted for 38.6% of the sample in 2011, compared to 29.3% in 2010, 26.3% in 2009 and 28.8% in 2008. For
these deals,, the median termination fee as a p
percentage
g of transaction value increased from 3.0% in 2010 to 3.1% in 2011.
The highest termination fee among the transactions in 2011 was observed in Duke Energy Corp.’s $13.6 billion acquisition of
Progress Energy Inc. (termination fee of $675 million, or 5.0% of transaction value).
Termination Fees by Transaction Size - Transaction Value
($ in millions)
Median
Transaction Value
No. of
Transactions
Median
Termination Fee
as a Percentage of
Transaction Value (1)
2011
2010
2011
2010
2011
2010
2011
2010
$50 million to $250 million
45
69
$131.4
$130.2
$4.4
$4.3
3.5%
3.7%
32
33
$345.9
$362.5
$10.2
$12.0
3.2%
3.2%
$500 million to $1 billion
25
28
$656.9
$717.2
$20.0
$23.9
3.3%
3.4%
More than $1 billion
64
54
$3,410.9
$2,315.1
$113.8
$69.5
3.1%
3.0%
166
184
$571.4
$419.6
$19.3
$12.8
3.2%
3.3%
Transaction Size
All
(1) Based on median of all calculated termination fees as a percentage of deal value, not calculation of observed median of deal value and termination fee.
11
Termination Fees by Transaction Size - Distribution of
Termination Fees
In dollar terms, termination fees tend to be heavily weighted toward the lower end of the distribution
curve. This was less pronounced in 2011 because the median transaction value continued to increase from
$263 million in 2008 to $571.4 million in 2011.
Approximately 33.1% of the deals sampled in the 2011 Study had termination fees of less than $10
million, compared with 41.3% in 2010, 48.0% in 2009 and 51.4% in 2008.
Distribution of Termination Fees
40%
Percentag e of Total Transsactions
2011 Transaction
Termination Fee
Study Summary
35%
30%
25%
2008
20%
2009
2010
15%
2011
10%
5%
0%
< $5
$5-$10
$10-$20
$20-$50
$50-$100 $100-$500
> $500
Termination Fee ($ millions)
12
2011 Transaction
Termination Fee
Study Summary
Termination Fees by Transaction Size - Enterprise
Value
In the 2011 Study, 66 deals had enterprise values greater than $1 billion compared with only 55 deals in 2010. These billion-dollar
transactions accounted for approximately 43.1% of the sample in 2011, compared to 34.6% in 2010, 30.5% in 2009 and 34.1%
in 2008. Within this segment of the sample, the median termination fee was 2.7% of enterprise value, down from 2.8% in 2010.
Termination fees as a percentage of enterprise value are inversely correlated to deal size.
Termination Fees by Enterprise Value(1)
($ in millions)
No. of
Transactions
Median
Enterprise Value
Median
Termination Fee
Median Termination
Fee as a Percentage of
Enterprise Value(2)
2011
2010
2011
2010
2011
2010
2011
2010
Less than $250 million
34
51
$137.5
$109.0
$4.0
$4.2
3.7%
4.0%
30
29
$336.6
$386.9
$10.2
$12.0
3.2%
3.3%
$500 million to $1 billion
23
24
$642.4
$692.6
$19.6
$21.2
3.0%
2.7%
More than $1 billion
66
55
$3,541.7
$2,747.6
$109.3
$67.0
2.7%
2.8%
153
159
$673.5
$475.5
$20.0
$14.0
3.1%
3.3%
Deal Size (Enterprise Value)
All
(1) Excludes banks and financial institutions due to lack of reliable data.
13
2011 Transaction
Termination Fee
Study Summary
Termination Fees by Consideration Form
While termination fees do correlate to enterprise value and transaction size, they do not correlate strongly to the form of
consideration.
The analysis indicates that during 2011, a slightly greater percentage of the transactions were structured using cash consideration
compared to 2010.
Termination Fee by Consideration Form
($ in millions)
Median
No. of Transactions
Transaction Value
Median Termination Fee as a Percentage of
Enterprise
Value(1)
Transaction Value(2)
Enterprise Value(1) (2)
2011
2010
2011
2010
2011
2010
2011
2010
2011
2010
2011
2010
All Stock
17
22
$994.7
$819.0
$2,247.3
$2,084.1
$40.0
$19.0
3.5%
3.4%
2.1%
2.6%
All Cash
120
132
$492.4
$383.7
$530.6
$420.6
$17.0
$11.4
3.2%
3.2%
3.2%
3.4%
Cash and Stock
29
30
$916.5
$421.8
$2,903.4
$681.2
$25.8
$12.4
3.1%
3.6%
2.6%
3.0%
166
184
$571.4
$419.6
$673.5
$475.5
$19.3
$12.8
3.2%
3.3%
3.1%
3.3%
Consideration Form
All
Source: Thomson Reuters
Reuters.
(1) Excludes banks and financial institutions due to lack of reliable data.
14
2011 Transaction
Termination Fee
Study Summary
Termination Fees by Acquisition Type
Transaction fees in 2011 were only somewhat affected by the nature of the transactions.
 We compared public-to-private transactions (including management buyouts, leveraged buyouts and
private equity investments) to all other types of transactions.
transactions
 48 transactions involved public targets going private, with median termination fees of 3.0% and
3.1% of transaction and enterprise values, respectively. The remaining 118, non-going-private
transactions yielded median termination fees of 3.3% and 3.1% of transaction and enterprise values,
respectively.
 We also compared termination fees paid in transactions involving strategic buyers to those paid in
transactions involving financial buyers. A strategic buyer is defined, for the purposes of our study, as a
buyer in the same industry, or a buyer seeking to vertically or horizontally integrate (including private
equity platform add-ons); a financial buyer is defined as a buyer seeking to profit by making an
acquisition, but not necessarily by expanding its own business operations.
 For the 120 transactions involving acquirers we considered strategic, the median termination fees
equaled 3.3% and 3.1% of transaction and enterprise values, respectively. The remaining 46
transactions involved financial acquirers and had median termination fees of 3.2% of transaction and
enterprise values.
15
2011 Transaction
Termination Fee
Study Summary
Bifurcated Termination Fees
Transactions with so-called “go-shop” provisions generally feature bifurcated termination fees. A lower termination fee is payable
during the go-shop period (the period during which the target is allowed to actively solicit competing offers). In the 2011 Study,
14 transactions (8.4% of sample) included bifurcated termination fees.
The post-go-shop period generally has higher termination fees as a percentage of transaction and enterprise value.
Bifurcated Termination Fees for Deals Announced in 2011
4.0%
4.0%
3.5%
3.4%
3.2%
3.5%
3.5%
2.9%
3.0%
3.0%
2.5%
2.5%
2.0%
Bifurcated Termination Fees for Deals Announced in 2010
2.0%
1.8%
1.8%
2.0%
1.5%
1.5%
1.5%
1.0%
1.0%
0.5%
0.5%
0.0%
0.0%
Median Termination Fee as a Percentage
of Transaction Value
During Go-Shop Period
Sources: Thomson Reuters and public filings.
of Enterprise Value
After Go-Shop Period
of Transaction Value
During Go-Shop Period
of Enterprise Value
After Go-Shop Period
Sources: Thomson Reuters and public filings.
16
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees in Court
The Delaware courts have found termination fees to be an acceptable and customary component of M&A
transactions. However, a target company’s board of directors can face criticism if the agreed-upon
termination fee (alone or in conjunction with other protective provisions) is sufficiently onerous to
dissuade or p
prevent another p
potential bidder from makingg a superior
p
offer for the target.
g
In assessing the reasonableness of termination fees, the Delaware Chancery Court (the Court) has refused
to establish a bright-line rule as to the maximum permissible size of a termination fee. Instead, the Court
has insisted that each case be decided on the particular facts and circumstances surrounding the
transaction. In this regard, Vice Chancellor Strine in In re Toys “R” Us, Inc. S’holder Litig., 877 A.2d 975
(Del Ch.
(Del.
Ch 2005) (Toys “R”
R Us) observed that the reasonableness of a particular termination fee requires a
“nuanced fact intensive inquiry.” That inquiry requires the Court to “consider a number of factors,
including without limitation: the overall size of the termination fee, as well as its percentage value; the
benefits to shareholders, including a premium (if any) that directors seek to protect; the absolute size of the
transaction, as well as the relative size of the partners to the merger; the degree to which a counterparty
protections to be crucial to the deal,, bearingg in mind differences in bargaining
g
gp
power;; and the
found such p
preclusive or coercive power of all deal protections included in a transaction, taken as a whole.” See
Louisiana Municipal Police Employees’ Retirement System v. Crawford, 918 A.2d 1172 (Del. Ch. 2007).
The reasonableness of termination fees was assessed in three cases decided by the Court in 2011: In re
Orchid Cellmark Inc. S’holder Litig., C.A. No. 6373-VCN (Del. Ch. May 12, 2011) (Orchid Cellmark), In
re Smurfit-Stone
S
fit St
C t i
Container
C p S’holder
Corp.
S’h ld Litig.,
Liti C.A.
C A No.
N 6164-VCP
6164 VCP (Del.
(D l Ch.
Ch May
M 20,
20 2011,
2011 revised
i d
May 24, 2011) (Smurfit-Stone) and In re Compellent Technologies, Inc. S’holder Litig., C.A. No. 6082VCL (Del. Ch. Dec. 9, 2011) (Compellent).
Source: Court documents.
17
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees in Court (cont.)
Orchid Cellmark
In Orchid Cellmark, Vice Chancellor Noble declined to enjoin the merger between LabCorp and Orchid
Cellmark Inc. ((OC).
) In so doing,
g, the Vice Chancellor addressed,, amongg other things,
g , the appropriateness
pp p
of
certain deal protection measures, including a termination fee. Following In re Cogent, Inc. S’holder Litig.,
2010 Del. Ch. LEXIS 203 (Cogent), the Court rejected the plaintiffs’ attempt to calculate the termination
fee as 4.6% of OC’s value “after discounting its $19.8 million of cash on hand.” Citing Cogent, the Court
observed that “Delaware’s case law…teaches that…termination fees are generally measured according to a
[c]ompany’s equity value.” Measured on that basis, the termination fee in Orchid Cellmark represented less
than
h 3% off OC’s
OC’ equity
i value
l and
d was deemed
d
d reasonable
bl by
b the
h Court
C
under
d the
h circumstances.
i
It should be noted that in certain other cases, such as In re Lear Corp. S’holder Litig., 926 A.2d 94 (Del.
Ch. 2007) and In re Dollar Thrifty S’holder Litig., 2010 WL 350471 (Del. Ch. Sept. 8, 2010), the Court
sanctioned enterprise value as an appropriate metric for evaluating the reasonableness of a termination fee
g y leveraged
g transaction.
in the context of a highly
Smurfit-Stone
The appropriateness of a termination fee was also challenged in Smurfit-Stone in the context of a 50%
cash and 50% stock acquisition of Smurfit-Stone Container Corp. by Rock-Tenn Co. In denying the
plaintiffs’
l i tiff ’ application
li ti for
f a preliminary
li i
i j
injunction,
ti
Vi Chancellor
Vice
Ch
ll Parsons
P
addressed,
dd
d among other
th things,
thi
the $120 million termination fee (which represented 3.4% of equity value). The Court held that the
termination fee, though “toward the upper boundary of permissibility under Delaware law,” was still
within the range previously found by the Delaware courts to be reasonable. The Court noted that the
termination fee was reciprocal.
18
2011 Transaction
Termination Fee
Study Summary
Transaction Termination Fees in Court (cont.)
Compellent
In Compellent, the issue of the appropriateness of a termination fee arose in the context of an award of
attorneys’
y fees followingg the settlement of a suit seekingg to enjoin
j
the acquisition
q
of Compellent
p
Technologies, Inc. (Compellent) by Dell Inc. (Dell). In assessing the plaintiffs’ attorneys’ request for a $6
million fee, Vice Chancellor Laster observed that the original merger agreement between the parties
provided for a $37 million termination fee (approximately 3.85% of Compellent’s equity value), plus
$960,000 (0.1%) in expense reimbursement under a variety of circumstances, including the occurrence of
any “Triggering Event” (which Vice Chancellor Laster described as a “Hair-Trigger Event” that would
i d
induce
the
h board
b d not to respond
d to a superior
i offer).
ff ) If the
h Compellent
C
ll
b d changed
board
h
d its
i recommendation
d i
due to a “Change in Circumstances” other than because of a topping bid, the termination fee rose to $47
million, plus the expense reimbursement (or 4.9% of Compellent’s equity value). As part of the settlement,
the definition of a “Triggering Event” was modified to delete a fee that would have been payable if
Compellent’s board failed to reaffirm its recommendation after being requested to do so by Dell and the
termination fee was reduced to 3.23%
3 23% of Compellent
Compellent’ss equity value.
value Vice Chancellor Laster characterized
the reduced fee as “healthy.”
Other Court Cases
The signpost for the outer limit of acceptability remains Phelps Dodge Corp. v. Cyprus Amax Minerals
Co., C.A. No. 17398 (Del.
l Ch.
h Sept. 27, 1999), in which
h h the
h Court found
f
d that
h a 6.3% termination fee
f
“stretches the definition of reasonableness beyond its breaking point.” Another judicial warning is Vice
Chancellor Strine’s admonition in Toys “R” Us that, in mega-deals, the absolute size of a termination fee
can be offensive irrespective of being within the range of historical percentages due to the “preclusive
differences between termination fees starting with a ‘b’ rather than an ‘m’.”
19
2011 Transaction
Termination Fee
Study Summary
Reverse Breakup Fees
Prior to 2005, private equity transactions were typically subject to financing conditions that would allow
the buyer to terminate the deal if debt financing was unavailable. As competition among private equity
firms increased and financing became readily available, targets began to require private equity buyers to
absorb more of the financing risk and to provide recourse, in the form of “reverse breakup fees,” which are
f
fees
payable
bl by
b the
h acquirer to the
h target iff funding
f d
f ll through
falls
h
h or the
h transaction is otherwise
h
terminated. These fees are backstopped by a limited guarantee by the private equity fund. The rationale
behind such fees is to compensate the target for the risk that “committed” financing does not fund and the
transaction does not close.
With the addition of a fund commitment or gguarantee,, financial sponsors
p
sought
g to limit the exposure
p
of
their investors by seeking a cap on the maximum extent of the fund’s exposure for a failed deal. Sponsors
were generally successful in this effort and the reverse termination fee quickly became a ceiling on a fund’s
liability for intentionally breaching the agreement.
In the aftermath of the numerous transactions that were abandoned in late 2007 and 2008, sellers became
more concerned about the optionality created by the reverse termination fee structure.
structure As a result,
result among
other things, reverse break fees increased in magnitude, with the median percentage of transaction value
increasing to 4.7% in 2009 from 3.5% in 2008 and the median percentage of enterprise value increasing
to 4.1% in 2009 from 3.2% in 2008. Reverse breakup fees remained at these elevated levels in 2010
(4.5% of transaction value and enterprise value) and 2011 (5.1% of transaction value and 4.5% of
enterprise
p
value).
)
In recognition, however, of the turbulent financing markets, two-tier fees were not uncommon, with a
lower fee payable if the closing did not occur due to a financing failure rather than a willful failure. For
example, in connection with its acquisition of Emdeon Inc., Blackstone Capital Partners VI agreed to a
reverse termination fee of 3.6% of transaction value in the event it was unable to raise financing; but a
7 0% reverse termination
7.0%
t
i ti fee
f for
f a "willful
" illf l breach"
b
h" off the
th merger agreement.
t Similarly,
Si il l Eagle
E l Parent
P
t Inc.
I
agreed to pay 2.5% of transaction value in the event it was unable to raise financing for its acquisition of
Epicor Software Corp., but a fee of 7.5% for a "willful breach" of the merger agreement.
20
2011 Transaction
Termination Fee
Study Summary
Reverse Breakup Fees (cont.)
Beginning in 2008, a number of strategic cash deals began to duplicate the private equity reverse break fee
structure. Historically, sellers had had less deal protection concerns with strategic buyers than with private
equity buyers. However, with the state of the financing markets and the fact that banks had begun to
introduce ggreater conditionalityy into their commitments,, that attitude changed.
g
In April
p 2008,, the $23
billion Mars Inc./Wm. Wrigley Jr. Co. deal became the first large strategic deal to be structured with a
private equity-style reverse termination fee.
During 2011, there was increased use of reverse termination fees as a means of mitigating antitrust risk.
For example, Google Inc.'s (Google) merger agreement with Motorola Mobility Holdings, Inc. (Motorola
Mobility) requires Google to pay a reverse termination fee of $2.5
$2 5 billion (20.7%
(20 7% of transaction value and
27.6% of enterprise value) if antitrust clearance is not obtained and the transaction is terminated as a
result. Similarly, AT&T Inc. (AT&T) agreed to pay a $3.0 billion reverse termination fee (7.7% of
transaction value and enterprise value) to Deutsche Telekom AG related to AT&T’s proposed acquisition
of T-Mobile USA, Inc., which was blocked for antitrust reasons. This represents the largest triggered
reverse termination fee on record.
Commentators have noted that forward and reverse termination fees serve different functions and should
be analyzed differently. Target termination fees have the potential to foreclose a competitive bidding
process, against the interests of shareholders of the target, by making acquisitions prohibitively expensive
for bidders late to approach the target. Accordingly, courts have expressed concern that termination fees
greater
t than
th approximately
i t l 3% off the
th purchase
h
price
i may interfere
i t f
with
ith the
th Revlon
R l
d ti off a sellers’
duties
ll ’
board to secure the highest price under the circumstances. Reverse termination fees, by contrast, raise no
such obvious concerns because they do not increase the cost of a bidding contest for later bidders.
21
2011 Transaction
Termination Fee
Study Summary
Of the 166 transactions reviewed in the 2011 Study, 73 (approximately 44%) had reverse breakup fees,
with median fees of 5.1% and 4.5% of transaction and enterprise values, respectively. In 2010, 76 (41%)
of the 184 transactions reviewed had reciprocal
p
termination fees,, with median fees of 4.5% of transaction
and enterprise values.
Reverse Breakup Fee Summary
($ in millions)
2011
No. of Transactions
2010
73
76
$991.2
$618.3
Median Target Fee as a Percentage of Transaction Value
3.1%
3.1%
Median Acquirer Fee as a Percentage of Transaction Value
5.1%
4.5%
$1,191.2
$737.4
Median Target Fee as a Percentage of Enterprise Value
2.8%
2.9%
Median Acquirer Fee as a Percentage of Enterprise Value
4 5%
4.5%
4 5%
4.5%
32.9%
42.1%
Percentage with Target Fee Higher than Acquirer Fee
6.8%
6.6%
Percentage with Acquirer Fee Higher than Target Fee
60.3%
51.3%
Median Enterprise Value
Percentage with Identical Termination Fee
22
2011 Transaction
Termination Fee
Study Summary
In 2010 and 2011, reverse breakup fees as a percentage of transaction and enterprise values were
significantly higher in transactions involving financial buyers.
Reverse Breakup Fee Summary
($ in millions)
2011 Transactions
Strategic
Buyers
No. of Transactions
2010 Transactions
Financial
Buyers
Strategic
Buyers
Financial
Buyers
42
31
48
28
$2,763.1
$534.2
$423.3
$795.5
Median Target Fee as a Percentage of Transaction Value
3.1%
3.1%
3.1%
2.9%
Median Acquirer Fee as a Percentage of Transaction Value
3.6%
6.2%
3.6%
5.7%
$3,963.9
$564.6
$415.9
$1,013.2
M di T
Median
Target F
Fee as a Percentage
P
off Enterprise
E
i Value
V l
2 6%
2.6%
3 0%
3.0%
3 1%
3.1%
2 3%
2.3%
Median Acquirer Fee as a Percentage of Enterprise Value
3.0%
6.0%
3.9%
5.7%
Median Enterprise Value
23
2011 Transaction
Termination Fee
Study Summary
Analysis of Withdrawn Transactions
Of the 166 transactions reviewed in the 2011 Study, nine (5.4%) were terminated. Three of these proposals were withdrawn
because the target company received a superior proposal during the go-shop period, three were terminated due to difficulty in
obtaining shareholder approval and three were terminated due to antitrust issues.
Termination fees were paid for six of the nine withdrawn transactions.
Reasons for Termination of Transactions in 2011
Other
11%
Superior Proposal
34%
Antitrust Issues
22%
Unable to Obtain
Shareholder
Approval
33%
Sources: Press releases and public filings.
24
2011 Transaction Termination Fee Detail
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$77.1
Enterprise
Value
($ M)
$55.0
Target
Term Fee
($ M)
$1.9
Term Fee as
a % of
Transaction
Value
2.46%
Term Fee as
a % of
Enterprise
Value
3.46%
Target Description
Manufacture pharmaceuticals
Acquirer Name
FCB I Acquisition Corp.
Acquirer Description
Special purpose acq vehicle
Acquisition
Technique
Consideration
Not Applicable
Cash
01/05/2011 Atheros Communications
Inc.
Manufacture semiconductors
T Merger Sub Inc.
Not Applicable
Cash
$3,854.4
$3,338.6
$103.7
2.69%
3.11%
01/10/2011 Progress Energy Inc.
Electric,gas utility company
Duke Energy Corp.
Pvd elec delivery svcs
Stock Swap
Stock
$13,618.3
$25,578.3
$675.0
4.96%
2.64%
01/18/2011 Sterling Bancshares Inc.
Bank holding company
Comerica Inc.
Pvd bkg svcs
Stock Swap
Stock
$1,041.0
$40.0
3.84%
NA
01/18/2011 RAE Systems Inc.
Mnfr multi-sensor monitors
Vector Capital Corp.
Private equity firm
Going Private
Cash
$133.9
$4.0
3.00%
3.27%
01/20/2011 Danvers Bancorp Inc.,MA
Stock savings holding bank
People's United FinancialCT
Tender Offer
Cash / Stock
$535.6
$19.7
3.68%
NA
01/21/2011 NovaMed Inc.
Own,op ambulatory surgery
ctr
Surgery Partners Holdings
LLC
Own,op ambulatory surgical
ctr
Tender Offer
Cash
$120.9
$212.4
$4.4
3.61%
2.06%
01/23/2011 Smurfit-Stone Container
Corp.
Mnfr paper-based pkg prod
Rock-Tenn Co.
Manufacture packaging
products
Not Applicable
Cash / Stock
$3,349.2
$4,094.2
$120.0
3.58%
2.93%
01/24/2011 Genoptix Inc.
Pvd bone marrow testing svcs
Novartis Finance SA
Investment company
Tender Offer
Cash
$440.2
$301.7
$16.5
3.75%
5.47%
01/26/2011 Abington
Bancorp Jenkintown PA
Bancorp,Jenkintown,PA
Susquehanna Bancshares
Inc
Inc.
Stock Swap
Cash / Stock
$272.9
$11.0
4.03%
NA
01/26/2011 ProLogis
Real estate investment trust
AMB Property Corp.
RE investment,development
firm
Stock Swap
Stock
$8,364.5
$15,155.8
$315.0
3.77%
2.08%
01/27/2011 Terremark Worldwide Inc.
Pvd IT infrastructure svcs
Verizon Holdings Inc.
Pvd telecommunications svcs
Tender Offer
Cash
$1,497.1
$2,032.2
$40.0
2.67%
1.97%
01/29/2011 Massey Energy Co.
Coal mining company
Alpha Natural Resources
Inc.
Coal mining co
Stock Swap
Cash / Stock
$7,307.6
$8,175.9
$251.0
3.43%
3.07%
01/31/2011 Pre-Paid Legal Services Inc.
Provide legal services
MidOcean Partners LLP
Private equity firm
Going Private
Cash
$653.5
$603.8
$21.5
3.29%
3.56%
02/01/2011 NaviSite Inc.
Pvd hosting,application svcs
Time Warner Cable Inc.
Provide cable TV services
Not Applicable
Cash
$260.9
$324.4
$7.5
2.87%
2.31%
02/03/2011 Answers Corp.
Pvd Internet search engine svc
AFCV Holdiings LLC
Investment holding company
Going Private
Cash
$166.3
$145.1
$4.6
2.77%
3.17%
02/03/2011 Silverleaf Resorts Inc.
Own,op time-share resorts
SL Resort Holdings Inc.
Investment company
Going Private
Cash
$94.4
$496.4
$4.4
4.66%
0.89%
02/07/2011 Herley Industries Inc.
Mnfr microwave components
Lanza Acquisition Co.
Pvd natl defense,sec svcs
Tender Offer
Cash
$323.7
$308.7
$9.4
2.92%
3.06%
02/07/2011 Emergent Group Inc.
Pvd laser equip rental svcs
Universal Hospital Services
Pvd med equip rental svcs
Tender Offer
Cash
$58.8
$53.7
$2.2
3.80%
4.16%
02/07/2011 Conexant Systems Inc.
Golden Gate Private Equity
Inc.
Private eq firm
Going Private
Cash
$197.0
$282.1
$7.7
3.91%
2.73%
Date
Announced Target Name
01/04/2011 CPEX Pharmaceuticals Inc.
NA
$122.6
NA
NA
26
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$7,306.4
Enterprise
Value
($ M)
$8,685.1
Target
Term Fee
($ M)
$260.0
Term Fee as
a % of
Transaction
Value
3.56%
Term Fee as
a % of
Enterprise
Value
2.99%
Acquisition
Technique
Stock Swap
Consideration
Cash
Tender Offer
Cash
$5,782.2
$6,575.5
$165.0
2.85%
2.51%
Stock Swap
Stock
$780.0
$918.1
$10.0
1.28%
1.09%
Not Applicable
Cash / Stock
$916.5
$1,284.2
$26.0
2.84%
2.02%
Provide stock exchange svcs
Stock Swap
Cash
$10,164.3
$12,225.3
$250.0
2.46%
2.04%
Hera Corp.
Pvd data,voice commun svcs
Not Applicable
Cash
$58.8
$62.1
$1.9
3.26%
3.09%
Pvd emergency med care svcs
Clayton Dubilier & Rice
LLC
Private equity firm
Going Private
Cash
$2,822.8
$2,923.2
$116.5
4.13%
3.99%
02/14/2011 Hughes Communications
Inc.
Pvd broadband satellite svcs
Broadband Acquisition
Corp.
Pvd satellite cable svcs
Not Applicable
Cash
$1,324.9
$1,881.1
$45.0
3.40%
2.39%
02/17/2011 LaBranche & Co Inc.
Securities brokerage firm
Louisiana Merger Sub Inc.
Stock Swap
Stock
$192.8
$6.3
3.24%
NA
02/21/2011 Zoran Corp.
CSR PLC
Mnfr single-chip radio devices
Not Applicable
Cash / Stock
$475.9
$224.4
$18.0
3.78%
8.02%
02/22/2011 Frontier Oil Corp.
Mnfr,whl crude oil,petro prod
Holly Corp.
Mnfr,whl refined petro prod
Stock Swap
Stock
$2,853.9
$2,644.8
$80.0
2.80%
3.02%
02/22/2011 Tollgrade Communications Develop network software
Inc.
Talon Merger Sub Inc.
Going Private
Cash
$131.4
$59.2
$3.0
2.28%
5.07%
02/22/2011 Clinical Data Inc.
Biotechnology company
Magnolia Acquisition
Corp.
Tender Offer
Cash
$1,340.6
$1,343.0
$45.0
3.36%
3.35%
02/23/2011 Crescent Finl
Corp,Cary,NC
Piedmont Community
Bank Group
Commercial bank (for US)
Not Applicable
Cash
$113.7
$4.0
3.52%
NA
02/28/2011 Nationwide Health
Properties
Ventas Inc.
Stock Swap
Stock
$5,793.5
$7,263.1
$175.0
3.02%
2.41%
03/03/2011 Global Defense Tech & Sys
Inc.
Pvd technology-based services
Sentinel Acq Hldg Corp.
Investment company
Going Private
Cash
$221.8
$300.8
$7.1
3.19%
2.35%
03/03/2011 America Service Group Inc.
Pvd managed health care svcs
Whiskey Acquisition Corp. Investment company
Going Private
Cash
$241.7
$202.1
$8.0
3.31%
3.96%
03/07/2011 Tomotherapy Inc.
Mnfr,whl radiation therapy
sys
Jaguar Acquisition Inc.
Mnfr,whl radiosurgical devices
Not Applicable
Cash / Stock
$274.1
$122.6
$8.0
2.92%
6.52%
03/10/2011 RC2 Corp.
Mnfr,whl games,toy products
Galaxy Dream Corp.
Manufacture,wholesale toys
Tender Offer
Cash
$638.1
$620.6
$20.9
3.28%
3.37%
03/12/2011 Lawson Software Inc.
Develop enterprise software
Atlantis Merger Sub Inc.
Investment company
Not Applicable
Cash
$2,028.1
$1,970.4
$75.0
3.70%
3.81%
Date
02/07/2011 Pride International Inc.
Target Description
Pvd oil,gas well drilling svcs
Acquirer Name
Ensco PLC
Oil,gas contract drilling
02/07/2011 Beckman Coulter Inc.
Mnfr laboratory instruments
Danaher Corp.
Mnfr tools,control equip
02/08/2011 Retail Ventures Inc.
Own,op footwear ret stores
DSW Inc.
Own,op shoe,handbag stores
02/08/2011 RehabCare Group Inc.
Pvd physical rehab mgmt svcs
Kindred Healthcare Inc.
Provide healthcare services
02/09/2011 NYSE Euronext Inc.
Pvd sec trading,brkg svcs
Deutsche Boerse AG
02/09/2011 XETA Technologies Inc.
Mnfr voice,data commun sys
02/14/2011 Emergency Medical Svcs
Corp.
NA
NA
27
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$156.2
Enterprise
Value
($ M)
$519.0
Target
Term Fee
($ M)
$12.0
Term Fee as
a % of
Transaction
Value
7.68%
Term Fee as
a % of
Enterprise
Value
2.31%
Target Description
Pvd oil,gas marine transp svcs
Acquirer Name
Kirby Corp.
Pvd inland transportation svcs
Acquisition
Technique
Consideration
Not Applicable Cash / Stock
03/14/2011 Lubrizol Corp.
Mnfr industrial chemicals
Berkshire Hathaway Inc.
Insurance holding company
Not Applicable
Cash
$8,793.3
$9,249.1
$200.0
2.27%
2.16%
03/14/2011 Animal Health
International
Wholesale animal health prod
Buffalo Acquisition Inc.
Going Private
Cash
$103.4
$246.7
$5.0
4.84%
2.03%
03/14/2011 Century Mining Corp.
Gold mining company
White Tiger Gold Ltd.
Gold,precious metals mining
co
Stock Swap
Stock
$851.0
$854.8
$13.5
1.59%
1.58%
03/18/2011 Celera Corp.
Pvd genetic research,dvlp svcs
Spark Acquisition Corp.
Pvd diagnostic testing svcs
Tender Offer
Cash
$656.9
$341.1
$23.5
3.57%
6.87%
03/21/2011 optionsXpress Holdings
Inc.
Provide brokerage services
Charles Schwab Corp.
Sec brkg firm
Stock Swap
Stock
$1,037.4
$1,056.6
$41.9
4.04%
3.97%
03/21/2011 TGC Industries Inc.
Pvd seismic data acq services
6446 Acquisition Corp.
Pvd onshore seismic data svcs
Stock Swap
Stock
$153.6
$153.9
$3.1
2.03%
2.03%
03/24/2011 drugstore.com Inc.
Pvd ecommerce retail services
Dover Subsidiary Inc.
Own,operate drug stores
Not Applicable
Cash
$414.2
$395.2
$15.0
3.63%
3.80%
03/25/2011 Encore Energy Partners LP
Oil,gas expl,production co
Vanguard Natural
Resources LLC
Oil,gas exploration,prodn co
Stock Swap
Stock
$994.7
$1,221.1
$20.0
2.01%
1.64%
03/28/2011 GSI Commerce Inc.
Pvd e-commerce solution svcs
Gibraltar Acquisition
Corp
Corp.
Not Applicable
Cash
$2,404.7
$2,329.4
$74.0
3.08%
3.18%
03/28/2011 Spectrum Control Inc.
Mnfr,whl electn control prod
API Technologies Corp.
Manufacture semiconductor
Not Applicable
Cash
$262.4
$262.0
$9.2
3.49%
3.49%
03/28/2011 Rural/Metro Corp.
Pvd medical transp svcs
Warburg Pincus LLC
Private equity firm
Going Private
Cash
$437.8
$674.1
$16.9
3.87%
2.51%
04/01/2011 SRA International Inc.
Pvd programming,consulting
svc
Providence Equity Partners
LLC
Private equity firm
Going Private
Cash
$1,791.0
$1,687.0
$47.0
2.62%
2.79%
04/04/2011 National Semiconductor
Corp.
Mnfr semiconductors,circuits
Orion Merger Corp.
Mnfr,whl semiconductors
Not Applicable
Cash
$7,132.6
$7,274.8
$200.0
2.80%
2.75%
04/04/2011 Epicor Software Corp.
Dvlp entrp business software
Eagle Parent Inc.
Going Private
Cash
$802.1
$945.5
$40.0
4.99%
4.23%
04/04/2011 LaBarge Inc.
Mnfr electronic devices
Ducommun Inc.
Mnfr,whl aircraft parts
Not Applicable
Cash
$310.5
$332.0
$12.4
4.00%
3.74%
04/05/2011 Inspire Pharmaceuticals
Inc.
Mnfr,whl pharmaceutical prod Monarch Transaction
Corp.
Mnfr,whl pharmaceutical prod
Going Private
Cash
$416.4
$341.9
$17.0
4.08%
4.97%
04/06/2011 Orchid Cellmark Inc.
Provide DNA testing services
OCM Acquisition Corp.
Tender Offer
Cash
$84.0
$66.7
$2.5
2.98%
3.75%
04/13/2011 Graham Packaging Co Inc.
Mnfr,whl plastic containers
Silgan Holdings Inc.
products
Not Applicable
Cash / Stock
$1,403.8
$4,060.8
$39.5
2.81%
0.97%
04/15/2011 Bronco Drilling Co Inc.
Provide land drilling services
Chesapeake Energy Corp.
Tender Offer
Cash
$316.8
$306.3
$13.0
4.10%
4.24%
Date
03/13/2011 K-Sea Transp Partners LP
28
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$22,765.7
Enterprise
Value
($ M)
$20,872.4
Target
Term Fee
($ M)
$650.0
Term Fee as
a % of
Transaction
Value
2.86%
Term Fee as
a % of
Enterprise
Value
3.11%
Acquisition
Technique
Stock Swap
Consideration
Cash / Stock
Going Private
Cash
$64.5
$64.1
$2.0
3.14%
3.16%
Not Applicable
Cash
$3,519.2
$4,682.4
$106.0
3.01%
2.26%
Tender Offer
Cash
$391.2
NA
$9.0
2.30%
NA
Not Applicable
Cash / Stock
$231.8
NA
$8.9
3.84%
NA
Going Private
Cash
$587.2
$507.9
$19.4
3.30%
3.82%
CenturyLink Inc.
Provide telecommunications
svc
Tender Offer
Cash / Stock
$2,491.3
$3,153.5
$85.0
3.41%
2.70%
Dvlp data imaging software
Toshiba Medical Systems
Corp.
Mnfr med imaging equip
Tender Offer
Cash
$262.9
$144.4
$8.2
3.12%
5.68%
04/27/2011 LoopNet Inc.
Pvd online coml RE info svcs
Lonestar Acquisition Sub
Inc.
Tender Offer
Cash / Stock
$991.2
$1,033.2
$25.8
2.60%
2.50%
04/28/2011 Constellation Energy
Group Inc
Inc.
Exelon Corp.
Stock Swap
Stock
$7,840.1
$11,430.5
$200.0
2.55%
1.75%
04/28/2011 State Bancorp Inc.,NY
Valley National
Bancorp,NJ
Stock Swap
Stock
$236.5
$8.8
3.70%
NA
04/28/2011 SunPower Corp.
Manufacture solar cells
Total Gas & Power
USA(SAS)
Tender Offer
Cash
$2,283.4
$2,568.6
$45.0
1.97%
1.75%
05/02/2011 International Coal Group
Inc.
Coal mining company
Atlas Acquisition Corp.
Investment company
Tender Offer
Cash
$3,472.6
$3,619.6
$115.0
3.31%
3.18%
05/02/2011 Cephalon Inc.
Mnfr,wholesale
pharmaceuticals
Teva Pharmaceutical
Industries
Mnfr,whl pharmaceuticals
Not Applicable
Cash
$6,310.9
$6,374.4
$275.0
4.36%
4.31%
05/02/2011 Volcom Inc.
Mnfr,whl,ret clothing
products
PPR SA
Retail home appl,luxury goods
Tender Offer
Cash
$607.8
$516.4
$20.0
3.29%
3.87%
05/04/2011 Varian Semiconductor
Equipment
Mnfr,whl semiconductor
equip
Barcelona Acquisition
Corp.
Mnfr,whl circuit fabrication
Not Applicable
Cash
$4,751.2
$4,329.2
$147.0
3.09%
3.40%
05/04/2011 Kendle International Inc.
Pvd clinical research svcs
INC Research LLC
Pvd contract research svcs
Going Private
Cash
$228.9
$344.1
$10.0
4.37%
2.91%
05/05/2011 Green
Bankshares,Greenville,TN
North American Finl Hldgs Bank holding company
Inc.
Stock Swap
Cash
$241.1
$8.0
3.32%
NA
05/06/2011 Warner Music Group
Corp.
Provide recorded music svcs
Access Industries Inc.
Going Private
Cash
$1,305.9
$2,937.9
$56.0
4.29%
1.91%
05/10/2011 CKx Inc.
Pvd motion picture prodn svcs
Apollo Global
Management LLC
Private equity firm
Tender Offer
Cash
$509.4
$534.3
$20.0
3.93%
3.74%
Date
04/18/2011 Synthes Inc.
Target Description
Mnfr,wholesale medical
devices
Acquirer Name
Johnson & Johnson
Mnfr,wholesale
pharmaceuticals
04/18/2011 Fremont MI InsuraCorp
Inc.
Auto Club Ins Association
Pvd ins,finl,RE svc
04/20/2011 DPL Inc.
Pvd electric,gas utility svcs
AES Corp.
Electric utility;holding co
04/20/2011 TradeStation Group Inc.
Felix 2011 Acquisition Sub
Inc.
04/20/2011 Bancorp Rhode Island Inc.
Bank holding co
Brookline Bancorp Inc.
04/26/2011 Smart Modular
Technologies
Mnfr,whl electronic
subsystems
Saleen Acquisition Inc.
04/27/2011 SAVVIS Inc.
Pvd information technology
svc
04/27/2011 Vital Images Inc.
NA
NA
29
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$300.4
Enterprise
Value
($ M)
$311.8
Target
Term Fee
($ M)
$9.9
Term Fee as
a % of
Transaction
Value
3.29%
Term Fee as
a % of
Enterprise
Value
3.17%
Target Description
Mnfr orthopedic biomaterials
Acquirer Name
Owl Acquisition Corp.
Acquisition
Technique
Tender Offer
Consideration
Cash
05/16/2011 PRIMEDIA Inc.
Publishing company
TPG Capital LP
Private equity firm
Going Private
Cash
$316.4
$515.9
$8.0
2.53%
1.55%
05/16/2011 Integral Systems Inc.
Pvd satellite ground sys svcs
Kratos Defense & Security
Pvd natl defense,sec services
Stock Swap
Cash / Stock
$224.9
$255.8
$9.3
4.14%
3.64%
05/18/2011 Nobel Learning
Communities Inc.
Own,operate schools
Leeds Equity Partners LLC
Private equity firm
Going Private
Cash
$127.7
$143.1
$5.0
3.91%
3.50%
05/24/2011 FPIC Insurance Group Inc.
Provide insurance services
Fountain Acquisition
Corp.
Going Private
Cash
$347.7
$346.4
$10.4
3.00%
3.01%
05/26/2011 Advanced Analogic Tech
Inc.
Mnfr,whl power
semiconductors
Skyworks Solutions Inc.
Mnfr,whl signal
semiconductors
Not Applicable
Cash / Stock
$311.3
$227.0
$8.5
2.73%
3.74%
05/30/2011 Cntrl Vermont Public Svc
Corp.
Electric utility company
Cedar Acquisition Sub Inc.
Not Applicable
Cash
$470.3
$673.5
$17.5
3.72%
2.60%
06/01/2011 Herald National Bank
Commercial bank
BankUnited Inc.
Commercial bank
Stock Swap
Cash / Stock
$50.8
$3.6
7.06%
NA
06/06/2011 Temple-Inland Inc.
Mnfr packaging,forest
products
International Paper Co.
Mnfr,whl paper pkg prod
Tender Offer
Cash
$3,819.0
$4,509.0
$105.0
2.75%
2.33%
06/12/2011 Transatlantic Holdings Inc. Pvd ins,reinsurance svcs
Allied World Assurance
Co Hldg
Co.
Stock Swap
Cash
$3,192.6
$3,867.0
$115.0
3.60%
2.97%
06/13/2011 EMS Technologies Inc.
Pvd wireless telecommun svcs
Honeywell International
Inc.
Mnfr aerospace,auto prod
Tender Offer
Cash / Stock
$522.4
$490.4
$19.6
3.75%
4.00%
06/13/2011 The Timberland Co.
Mnfr footwear,apparel prod
VF Enterprises Inc.
Manufacture,wholesale
apparel
Not Applicable
Cash
$2,180.7
$1,915.4
$87.2
4.00%
4.55%
06/13/2011 M&F Worldwide Corp.
Holding company
MacAndrews & Forbes
Hldg Inc.
Going Private
Cash
$483.3
$8.3
1.71%
NA
06/13/2011 Gerber Scientific Inc.
Pvd software dvlp svcs
Private equity firm
Going Private
Cash
$276.5
$290.0
$7.9
2.85%
2.72%
Reynolds Group Holdings
Ltd.
Mnfr,whl packaging products
Going Private
Cash
$1,808.4
$4,465.4
$39.5
2.18%
0.88%
06/14/2011 Express-1 Expedited
Solutions
Pvd expedited transp svcs
Investor Group
Investor group
Going Private
Cash
$208.2
$287.1
$2.2
1.08%
0.78%
06/15/2011 Parkvale Financial Corp.
Bk hldg co
FNB
Corp,Naples,Hermitage,PA
Stock Swap
Stock
$126.9
$6.0
4.73%
NA
06/16/2011 Southern Union Co.
Gas utility company
Energy Transfer Equity LP
Pvd natural gas transp,distn
Stock Swap
Cash / Stock
06/16/2011 MediaMind Technologies
Inc.
Pvd online campaign mgt svcs
DG FastChannel Inc.
Pvd digital media advg svcs
Tender Offer
Cash
06/17/2011 BJ's Wholesale Club Inc.
Own,op misc merchandise
store
BJ's Wholesale Club Inc.
SPV
Going Private
Cash / Stock
Date
05/16/2011 Orthovita Inc.
NA
NA
NA
$5,560.8
$9,275.0
$135.0
2.43%
1.46%
$497.9
$395.5
$18.5
3.72%
4.68%
$2,862.9
$2,692.8
$80.0
2.79%
2.97%
30
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$344.1
Enterprise
Value
($ M)
NA
Target
Term Fee
($ M)
$13.5
Term Fee as
a % of
Transaction
Value
3.92%
Term Fee as
a % of
Enterprise
Value
NA
Acquisition
Technique
Stock Swap
Consideration
Cash / Stock
New England Energy Corp. Pvd natural gas distn svcs
Not Applicable
Cash
$486.9
$690.1
$17.5
3.59%
2.54%
Provide medical services
Cab Merger Sub Inc.
Pvd med group practice svcs
Not Applicable
Cash / Stock
$414.3
$369.7
$9.0
2.17%
2.43%
07/01/2011 Blackboard Inc.
Bulldog Acquisition Sub
Inc.
Private equity firm
Going Private
Cash
$1,625.2
$1,751.5
$49.1
3.02%
2.80%
07/05/2011 Immucor Inc.
Mnfr,whl reagents
IVD Acquisition Corp.
Investment company
Going Private
Cash
$1,923.6
$1,621.0
$45.0
2.34%
2.78%
07/05/2011 Ameron International
Corp.
Mnfr engineered products
National Oilwell Varco Inc. Mnfr,whl gas drilling equip
Not Applicable
Cash
$779.6
$642.4
$20.0
2.57%
3.11%
07/07/2011 APAC Customer Services
Inc.
Provide customer mgmt svcs
One Equity Partners LLC
Private equity firm
Going Private
Cash
$517.0
$467.0
$15.0
2.90%
3.21%
07/11/2011 Arch Chemicals Inc.
Manufacture specialty
chemical
Lonza Group Ltd.
Biopharmaceutical company
Tender Offer
Cash
$1,201.9
$1,474.0
$40.0
3.33%
2.71%
07/11/2011 Radiant Systems Inc.
Develop management software
Ranger Acquisition Corp.
Tender Offer
Cash
$1,193.1
$1,102.6
$35.7
2.99%
3.24%
07/12/2011 Conmed Healthcare Mgmt
Inc
Inc.
Ayelet Investments LLC
Investment company
Going Private
Cash
$62.2
$47.5
$2.3
3.69%
4.82%
07/13/2011 Kinetic Concepts Inc.
Mnfr,whl therapeutic beds
Chiron Holdings Inc.
Going Private
Cash
$5,139.0
$5,765.4
$155.4
3.02%
2.70%
07/14/2011 Petrohawk Energy Corp.
Oil,gas
exploration,production
BHP Billiton PLC
Mnfr,whl metal,diamond prod
Tender Offer
Cash
$11,776.2
$15,556.5
$395.0
3.35%
2.54%
07/20/2011 Allos Therapeutics Inc.
AMAG Pharmaceuticals
Inc.
Stock Swap
Stock
$258.2
$148.5
$9.0
3.49%
6.06%
07/20/2011 Nalco Holding Co.
Provide water treatment svcs
Ecolab Inc.
Mnfr,whl cleaning products
Stock Swap
Cash / Stock
$5,411.9
$8,110.4
$135.0
2.49%
1.66%
07/20/2011 SFN Group Inc.
Pvd temporary staffing svcs
Randstad Holding NV
Provide recruitment services
Tender Offer
Cash
$734.2
$730.3
$27.0
3.68%
3.70%
07/21/2011 Medco Health Solutions
Inc.
Pvd pharmaceutical mgmt svcs
Express Scripts Inc.
Pvd pharmacy benefit mgmt
svcs
Stock Swap
Cash / Stock
$29,369.9
$34,305.4
$650.0
2.21%
1.89%
07/25/2011 Paradigm Holdings Inc.
Pvd info technology services
CACI International Inc.
Pvd information tech svcs
Not Applicable
Cash
$61.5
$71.0
$1.5
2.50%
2.17%
07/26/2011 S1 Corp.
Develop financial software
ACI Worldwide Inc.
Develop e-payment
e payment software
Tender Offer
Cash / Stock
$555.6
$481.6
$19.1
3.44%
3.97%
07/29/2011 Allied Healthcare Intl Inc.
Pvd healthcare staffing svcs
Saga Group Ltd.
Pvd tour op,ins svcs
Going Private
Cash
$189.2
$150.0
$5.2
2.75%
3.47%
08/01/2011 PAETEC Holding Corp.
Windstream Corp.
Not Applicable
Stock
$828.1
$2,247.3
$40.0
4.83%
1.78%
Date
06/20/2011 Tower Bancorp Inc.
Target Description
Acquirer Name
Susquehanna Bancshares
Inc.
Corp.
06/27/2011 Continucare Corp.
31
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$276.9
Enterprise
Value
($ M)
$235.2
Target
Term Fee
($ M)
$8.3
Term Fee as
a % of
Transaction
Value
2.99%
Term Fee as
a % of
Enterprise
Value
3.52%
Target Description
Provide traffic,news reports
Acquirer Name
GTCR Gridlock
Acquisition Sub
Acquisition
Technique
Going Private
Consideration
Cash
Develop payment mgmt
software
Blackstone Capital
Partners VI
Private equity firm
Going Private
Cash
$2,200.5
$3,026.8
$65.0
2.95%
2.15%
National Indemnity Co.
Pvd ppty,casualty ins svcs
Not Applicable
Cash
$3,249.2
$3,913.3
$75.0
2.31%
1.92%
08/15/2011 Motorola Mobility
Holdings Inc.
Mnfr,whl communication
prod
Google Inc.
Pvd internet search engine svc
Not Applicable
Cash
$12,102.8
$9,053.8
$375.0
3.10%
4.14%
08/16/2011 Renaissance Learning Inc.
Dvlp educational software
Raphael Acquisition Corp.
Private equity firm
Going Private
Cash
$436.1
$426.8
$13.0
2.98%
3.05%
09/07/2011 Penn Millers Holding
Corp.
Insurance company
ACE Ltd.
Insurance company
Not Applicable
Cash
$107.2
$102.4
$3.8
3.50%
3.66%
09/08/2011 Caliper Life Sciences Inc.
Mnfr,whl lab analytical instr
PerkinElmer Inc.
Mnfr research,medical equip
Not Applicable
Cash
$611.6
$577.3
$12.8
2.09%
2.22%
09/12/2011 Global Industries Ltd.
Pvd oil,gas engineering svcs
Apollon Merger Sub B Inc.
Pvd oil,gas engineering svcs
Not Applicable
Cash
$915.2
$983.9
$30.0
3.28%
3.05%
09/12/2011 NetLogic Microsystems
Mnfr semiconductor
processors
I&N Acquisition Corp.
Mnfr semiconductors
Not Applicable
Cash
$3,677.9
$3,463.8
$127.0
3.45%
3.67%
09/21/2011 Goodrich Corp.
Mnfr,whl aircraft parts,equip
United Technologies Corp.
Mnfr,whl aerospace sys prod
Tender Offer
Cash
$16,162.8
$18,019.6
$500.0
3.09%
2.77%
09/22/2011 American Medical Alert
Corp.
Mnfr,whl med monitoring
equip
Tunstall Healthcare Group
Ltd.
Mnfr,whl wireless devices
Going Private
Cash
$82.2
$77.5
$3.5
4.26%
4.52%
10/03/2011 Pharmaceutical Prod Dvlp
Inc.
Pvd research,development svcs
Pharm Product Dvlp Inc.
SPV
Going Private
Cash
$3,870.9
$3,387.0
$116.2
3.00%
3.43%
10/07/2011 Southwall Technologies
Inc.
Manufacture thin-film
coatings
Backbone Acquisition Sub
Inc.
Investment company
Tender Offer
Cash
$79.1
$75.0
$4.0
5.06%
5.33%
10/10/2011 Complete Production Svcs
Inc.
Provide oil,gas field services
Superior Energy Services
Inc.
Provide oilfield services
Stock Swap
Cash / Stock
$2,672.3
$3,114.0
$70.0
2.62%
2.25%
10/11/2011 99 Cents Only Stores
Own,operate variety stores
Investor Group
Investor group
Going Private
Cash
$1,563.2
$1,349.3
$47.3
3.02%
3.50%
10/11/2011 Bigband Networks Inc.
Dvlp digital video networking
Amsterdam Acquisition
Sub Inc.
Mnfr communication
equipments
Not Applicable
Cash
$160.8
$40.9
$5.5
3.42%
13.43%
10/16/2011 El Paso Corp.
Pvd gas transmission svcs
Kinder Morgan Inc.
Pvd gas transmission services
Tender Offer
Cash / Stock
$20,161.1
$32,338.1
$650.0
3.22%
2.01%
10/17/2011 Brigham Exploration Co.
Oil and gas exploration,prodn
Statoil ASA
Oil and gas exploration,prodn
Tender Offer
Cash
$4,406.8
$4,782.2
$136.6
3.10%
2.86%
10/17/2011 Anadys Pharmaceuticals
Inc.
Bryce Acquisition Corp.
Tender Offer
Cash
$219.5
$200.4
$8.0
3.64%
3.99%
10/24/2011 HealthSpring Inc.
Own,operate HMO
Citrine Magnolia Corp.
Own,operate HMO
Not Applicable
Cash
$3,859.9
$3,140.1
$115.0
2.98%
3.66%
Date
08/03/2011 Global Traffic Network
Inc.
08/04/2011 Emdeon Inc.
32
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$215.3
Enterprise
Value
($ M)
$209.1
Target
Term Fee
($ M)
$10.0
Term Fee as
a % of
Transaction
Value
4.64%
Term Fee as
a % of
Enterprise
Value
4.78%
Acquisition
Technique
Tender Offer
Consideration
Cash
Not Applicable
Cash
$1,838.3
$1,771.8
$59.7
3.25%
3.37%
Pvd advertising platform svcs
Tender Offer
Cash
$222.4
$215.3
$9.0
4.05%
4.18%
Presidio Networked
Solutions
Provide info tech services
Going Private
Cash
$85.0
$78.0
$3.7
4.39%
4.78%
Own,op hotels,resorts,cruises
Sonesta Acquisition Corp.
Going Private
Cash
$114.6
$130.7
$4.0
3.49%
3.06%
11/07/2011 Tekelec
Mnfr,whl network mgmt
equip
Titan Private Acquisition
Corp.
Investment company
Going Private
Cash
$761.8
$491.3
$15.0
1.97%
3.05%
11/07/2011 American Dental Partners
Inc.
Pvd dental practice svcs
JLL Crown Merger Sub
LLC
Going Private
Cash
$312.7
$388.4
$13.9
4.44%
3.58%
11/07/2011 Force Protection Inc.
Manufacture motor vehicles
General Dynamics Corp.
Mnfr aerospace,defense equip
Tender Offer
Cash
$388.0
$266.1
$10.0
2.58%
3.76%
11/08/2011 McCormick & Schmicks
Seafood
Own,op seafood restaurants
MSA Co Inc.
Going Private
Cash
$130.3
$131.9
$3.9
2.99%
2.96%
11/21/2011 Pharmasset Inc.
Mnfr pharm prod
Royal Merger Sub II Inc.
Biotechnology company
Tender Offer
Cash
$10,996.3
$10,832.5
$331.9
3.02%
3.06%
Alleghany Corp.
Pvd ppty,liability ins svcs
Stock Swap
Cash / Stock
$3,685.6
$4,306.9
$115.0
3.12%
2.67%
11/30/2011 Magma Design
Automation Inc.
Dvlp electn design software
Synopsys Inc.
Dvlp automation software
Not Applicable
Cash
$620.7
$594.7
$27.5
4.43%
4.62%
12/03/2011 SuccessFactors Inc.
Develop business software
SAP America Inc.
Dvlp business mgmt software
Tender Offer
Cash
$3,605.2
$3,356.8
$112.5
3.12%
3.35%
12/08/2011 DemandTec Inc.
Dvlp consumer mgmt software Cudgee Acquisition Corp.
Pvd information tech services
Not Applicable
Cash
$439.4
$379.8
$14.0
3.19%
3.69%
12/09/2011 Blue Coat Systems Inc.
Mnfr,whl web sec hardware
Blue Coat Systems Inc. SPV
Going Private
Cash
$1,238.2
$955.4
$39.0
3.15%
4.08%
12/13/2011 Synovis LIfe technologies
Inc.
Mnfr,whl medical devices
Baxter International Inc.
Mnfr,whl biological products
Not Applicable
Cash
$375.9
$316.7
$9.8
2.59%
3.08%
12/14/2011 Novellus Systems Inc.
Mnfr advanced process equip
Lam Research Corp.
Mnfr wafer fabrication equip
Stock Swap
Stock
$3,010.0
$2,652.9
$120.0
3.99%
4.52%
12/15/2011 SonoSite Inc.
Mnfr,whl portable ultrasound
Fujifilm Holdings Corp.
Manufacture imaging
products
Tender Offer
Cash
$796.2
$821.3
$24.9
3.13%
3.03%
12/16/2011 Morton's Restaurant
Group Inc.
Own,operate restaurants
Landry's Inc.
Going Private
Cash
$116.8
$182.8
$3.5
3.00%
1.91%
12/16/2011 RSC Holdings Inc.
Pvd equipment rental services
United Rentals Inc.
Not Applicable
Cash / Stock
$1,929.8
$4,186.4
$60.0
3.11%
1.43%
Date
10/24/2011 Adolor Corp.
Target Description
Acquirer Name
FRD Acquisition Corp.
10/24/2011 RightNow Technologies
Inc.
Dvlp eCommerce software
Rhea Acquisition Corp.
Dvlp enterprise software
11/01/2011 Interclick Inc.
Pvd advertising platform svcs
Innsbruck Acquisition
Corp.
11/01/2011 INX Inc.
Pvd data ctr solutions svcs
11/03/2011 Sonesta Intl Hotels Corp.
33
2011 Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$534.2
Enterprise
Value
($ M)
$594.9
Target
Term Fee
($ M)
$19.6
Term Fee as
a % of
Transaction
Value
3.67%
Term Fee as
a % of
Enterprise
Value
3.29%
Acquisition
Technique
Going Private
Consideration
Cash
Insurance company
Not Applicable
Cash
$2,587.1
$3,101.4
$82.0
3.17%
2.64%
Cod Merger Co Inc.
Investment company
Going Private
Cash
$154.1
$526.9
$11.0
7.14%
2.09%
Investor Group
Investor group
Going Private
Cash
$98.5
$293.7
$2.5
2.54%
0.85%
12/23/2011 Parlux Fragrances Inc.
Mnfr,whl perfumes,beauty
prod
Perfumania Holdings Inc.
Wholesale perfumes,fragrances
Stock Swap
Cash / Stock
$216.6
$204.5
$4.0
1.85%
1.96%
12/27/2011 Cogdell Spencer Inc.
Ventas Inc.
Not Applicable
Cash
$217.3
$706.0
$15.0
6.90%
2.12%
Date
12/19/2011 Winn-Dixie Stores Inc.
Target Description
Own,op retail grocery stores
Acquirer Name
Bi-Lo LLC
Own,operate grocery stores
12/21/2011 Delphi Financial Group
Inc.
Insurance company
Tokio Marine & Nichido
Fire
12/21/2011 WCA Waste Corp.
Pvd waste mgmt,disposal svcs
12/22/2011 RAM Energy Resources
Inc.
34
2011 Reverse Transaction Termination Fee Detail
2011 Reverse
Transaction
Termination Fee
Detail
Date
01/10/2011 Progress Energy Inc.
Target Description
Acquirer Name
Duke Energy Corp.
Pvd elec delivery svcs
01/21/2011 NovaMed Inc.
Own,op ambulatory surgery
ctr
Surgery Partners Holdings
LLC
Own,op ambulatory surgical
ctr
01/23/2011 Smurfit-Stone Container
Corp.
Mnfr paper-based pkg prod
Rock-Tenn Co.
products
01/26/2011 ProLogis
AMB Property Corp.
RE investment,development
firm
01/29/2011 Massey Energy Co.
Coal mining company
Alpha Natural Resources
Inc.
Coal mining co
01/31/2011 Pre-Paid Legal Services Inc.
Provide legal services
MidOcean Partners LLP
02/03/2011 Answers Corp.
Pvd Internet search engine svc
02/03/2011 Silverleaf Resorts Inc.
Acquisition
Technique
Stock Swap
Consideration
Stock
Tender Offer
Cash
Not Applicable
Transaction
Value
($ M)
$13,618.3
Enterprise
Value
($ M)
$25,578.3
Reverse
Term Fee
($ M)
$675.0
Reverse
Term Fee as
a % of
Transaction
Value
4.96%
Reverse
Term Fee as
a % of
Enterprise
Value
2.64%
$120.9
$212.4
$6.6
5.42%
3.08%
Cash / Stock
$3,349.2
$4,094.2
$120.0
3.58%
2.93%
Stock Swap
Stock
$8,364.5
$15,155.8
$210.0
2.51%
1.39%
Stock Swap
Cash / Stock
$7,307.6
$8,175.9
$252.0
3.45%
3.08%
Private equity firm
Going Private
Cash
$653.5
$603.8
$50.0
7.65%
8.28%
AFCV Holdiings LLC
Going Private
Cash
$166.3
$145.1
$7.6
4.57%
5.24%
Own,op time-share resorts
SL Resort Holdings Inc.
Investment company
Going Private
Cash
$94.4
$496.4
$10.0
10.59%
2.01%
02/07/2011 Pride International Inc.
Pvd oil,gas well drilling svcs
Ensco PLC
Oil,gas contract drilling
Stock Swap
Cash
$7,306.4
$8,685.1
$260.0
3.56%
2.99%
02/08/2011 Retail Ventures Inc.
Own,op footwear ret stores
DSW Inc.
Own,op shoe,handbag stores
Stock Swap
Stock
$780.0
$918.1
$10.0
1.28%
1.09%
02/08/2011 RehabCare Group Inc.
Pvd physical rehab mgmt svcs
Kindred Healthcare Inc.
Not Applicable
Cash / Stock
$916.5
$1,284.2
$62.0
6.76%
4.83%
02/09/2011 NYSE Euronext Inc.
Pvd sec trading,brkg svcs
Deutsche Boerse AG
Provide stock exchange svcs
Stock Swap
Cash
$10,164.3
$12,225.3
$250.0
2.46%
2.04%
02/14/2011 Emergency Medical Svcs
Corp.
Pvd emergency med care svcs
Clayton Dubilier & Rice
LLC
Private equity firm
Going Private
Cash
$2,822.8
$2,923.2
$203.9
7.22%
6.97%
02/17/2011 LaBranche & Co Inc.
Louisiana Merger Sub Inc.
Stock Swap
Stock
$192.8
$6.3
3.24%
NA
02/22/2011 Frontier Oil Corp.
Mnfr,whl crude oil,petro prod
Holly Corp.
Mnfr,whl refined petro prod
Stock Swap
Stock
$2,853.9
$2,644.8
$80.0
2.80%
3.02%
02/22/2011 Tollgrade Communications Develop network software
Inc.
Talon Merger Sub Inc.
Going Private
Cash
$131.4
$59.2
$4.0
3.04%
6.76%
02/28/2011 Nationwide Health
Properties
Ventas Inc.
Stock Swap
Stock
$5,793.5
$7,263.1
$175.0
3.02%
2.41%
03/12/2011 Lawson Software Inc.
Atlantis Merger Sub Inc.
Investment company
Not Applicable
Cash
$2,028.1
$1,970.4
$115.0
5.67%
5.84%
03/14/2011 Animal Health
International
Buffalo Acquisition Inc.
Going Private
Cash
$103.4
$246.7
$15.0
14.51%
6.08%
03/20/2011 T-Mobile USA, Inc.
AT&T Inc.
Not Applicable
Cash / Stock
$39,000.0
$38,891.0
$3,000.0
7.69%
7.71%
NA
36
2011 Reverse
Transaction
Termination Fee
Detail
Transaction
Value
($ M)
$153.6
Enterprise
Value
($ M)
$153.9
Reverse
Term Fee
($ M)
$2.4
Reverse
Term Fee as
a % of
Transaction
Value
1.53%
Reverse
Term Fee as
a % of
Enterprise
Value
1.53%
Acquisition
Technique
Stock Swap
Consideration
Stock
Not Applicable
Cash
$414.2
$395.2
$15.0
3.63%
3.80%
Private equity firm
Going Private
Cash
$437.8
$674.1
$33.8
7.73%
5.02%
Providence Equity Partners
LLC
Private equity firm
Going Private
Cash
$1,791.0
$1,687.0
$112.9
6.30%
6.69%
Mnfr semiconductors,circuits
Orion Merger Corp.
Mnfr,whl semiconductors
Not Applicable
Cash
$7,132.6
$7,274.8
$350.0
4.91%
4.81%
04/04/2011 Epicor Software Corp.
Dvlp entrp business software
Eagle Parent Inc.
Going Private
Cash
$802.1
$945.5
$60.0
7.48%
6.35%
04/06/2011 Orchid Cellmark Inc.
Provide DNA testing services
OCM Acquisition Corp.
Tender Offer
Cash
$84.0
$66.7
$0.2
0.18%
0.22%
Silgan Holdings Inc.
products
Not Applicable
Cash / Stock
$1,403.8
$4,060.8
$39.5
2.81%
0.97%
04/18/2011 Synthes Inc.
Mnfr,wholesale medical
devices
Johnson & Johnson
Mnfr,wholesale
pharmaceuticals
Stock Swap
Cash / Stock
$22,765.7
$20,872.4
$650.0
2.86%
3.11%
04/26/2011 Smart Modular
Technologies
Mnfr,whl electronic
subsystems
Saleen Acquisition Inc.
Going Private
Cash
$587.2
$507.9
$58.1
9.89%
11.44%
04/27/2011 LoopNet Inc.
Pvd online coml RE info svcs
Lonestar Acquisition Sub
Inc.
Tender Offer
Cash / Stock
$991.2
$1,033.2
$51.6
5.21%
4.99%
04/28/2011 Constellation Energy
Group Inc.
Exelon Corp.
Stock Swap
Stock
$7,840.1
$11,430.5
$800.0
10.20%
7.00%
05/04/2011 Varian Semiconductor
Equipment
Mnfr,whl semiconductor
equip
Barcelona Acquisition
Corp.
Mnfr,whl circuit fabrication
Not Applicable
Cash
$4,751.2
$4,329.2
$200.0
4.21%
4.62%
05/04/2011 Kendle International Inc.
Pvd clinical research svcs
INC Research LLC
Pvd contract research svcs
Going Private
Cash
$228.9
$344.1
$25.0
10.92%
7.27%
05/05/2011 Green
Bankshares,Greenville,TN
North American Finl Hldgs Bank holding company
Inc.
Stock Swap
Cash
$241.1
$8.0
3.32%
NA
05/06/2011 Warner Music Group
Corp.
Provide recorded music svcs
Access Industries Inc.
Going Private
Cash
$1,305.9
$2,937.9
$60.0
4.59%
2.04%
05/10/2011 CKx Inc.
Pvd motion picture prodn svcs
Apollo Global
Management LLC
Private equity firm
Tender Offer
Cash
$509.4
$534.3
$40.0
7.85%
7.49%
05/16/2011 PRIMEDIA Inc.
Publishing company
TPG Capital LP
Private equity firm
Going Private
Cash
$316.4
$515.9
$30.0
9.48%
5.81%
05/18/2011 Nobel Learning
Communities Inc.
Own,operate schools
Leeds Equity Partners LLC
Private equity firm
Going Private
Cash
$127.7
$143.1
$5.0
3.91%
3.50%
05/24/2011 FPIC Insurance Group Inc.
Provide insurance services
Fountain Acquisition
Corp.
Going Private
Cash
$347.7
$346.4
$10.4
3.00%
3.01%
Date
03/21/2011 TGC Industries Inc.
Target Description
Pvd seismic data acq services
Acquirer Name
6446 Acquisition Corp.
Pvd onshore seismic data svcs
03/24/2011 drugstore.com Inc.
Dover Subsidiary Inc.
Own,operate drug stores
03/28/2011 Rural/Metro Corp.
Pvd medical transp svcs
Warburg Pincus LLC
04/01/2011 SRA International Inc.
Pvd programming,consulting
svc
04/04/2011 National Semiconductor
Corp.
NA
37
2011 Reverse
Transaction
Termination Fee
Detail
Date
Corp.
Target Description
Acquirer Name
Cedar Acquisition Sub Inc.
06/01/2011 Herald National Bank
Commercial bank
BankUnited Inc.
Commercial bank
06/06/2011 Temple-Inland Inc.
Mnfr packaging,forest
products
International Paper Co.
Mnfr,whl paper pkg prod
Allied World Assurance
Co. Hldg
06/13/2011 EMS Technologies Inc.
Honeywell International
Inc.
06/13/2011 Gerber Scientific Inc.
Pvd software dvlp svcs
06/16/2011 Southern Union Co.
Acquisition
Technique
Consideration
Not Applicable
Cash
Transaction
Value
($ M)
$470.3
NA
Reverse
Term Fee as
a % of
Enterprise
Value
0.30%
$5.0
9.84%
NA
Reverse
Term Fee
($ M)
$2.0
Stock Swap
Cash / Stock
Tender Offer
Cash
$3,819.0
$4,509.0
$200.0
5.24%
4.44%
Stock Swap
Cash
$3,192.6
$3,867.0
$115.0
3.60%
2.97%
Mnfr aerospace,auto prod
Tender Offer
Cash / Stock
$522.4
$490.4
$19.6
3.75%
4.00%
Private equity firm
Going Private
Cash
$276.5
$290.0
$16.9
6.11%
5.83%
Gas utility company
Energy Transfer Equity LP
Pvd natural gas transp,distn
Stock Swap
Cash / Stock
$5,560.8
$9,275.0
$135.0
2.43%
1.46%
06/16/2011 MediaMind Technologies
Inc.
Pvd online campaign mgt svcs
DG FastChannel Inc.
Pvd digital media advg svcs
Tender Offer
Cash
$497.9
$395.5
$40.0
8.03%
10.11%
06/17/2011 BJ's Wholesale Club Inc.
Own,op misc merchandise
store
BJ's Wholesale Club Inc.
SPV
Going Private
Cash / Stock
$2,862.9
$2,692.8
$175.0
6.11%
6.50%
06/27/2011 Continucare Corp.
Provide medical services
Cab Merger Sub Inc.
Pvd med group practice svcs
Not Applicable
Cash / Stock
$414.3
$369.7
$12.0
2.90%
3.25%
07/01/2011 Blackboard Inc.
Bulldog Acquisition Sub
Inc.
Private equity firm
Going Private
Cash
$1,625.2
$1,751.5
$106.4
6.55%
6.08%
07/05/2011 Immucor Inc.
Mnfr,whl reagents
IVD Acquisition Corp.
Investment company
Going Private
Cash
$1,923.6
$1,621.0
$90.0
4.68%
5.55%
07/12/2011 Conmed Healthcare Mgmt
Inc.
Ayelet Investments LLC
Investment company
Going Private
Cash
$62.2
$47.5
$2.3
3.69%
4.82%
07/13/2011 Kinetic Concepts Inc.
Mnfr,whl therapeutic beds
Chiron Holdings Inc.
Going Private
Cash
$5,139.0
$5,765.4
$317.2
6.17%
5.50%
07/20/2011 Allos Therapeutics Inc.
AMAG Pharmaceuticals
Inc.
Stock Swap
Stock
$258.2
$148.5
$14.0
5.42%
9.43%
07/20/2011 Nalco Holding Co.
Provide water treatment svcs
Ecolab Inc.
Mnfr,whl cleaning products
Stock Swap
Cash / Stock
$5,411.9
$8,110.4
$275.0
5.08%
3.39%
07/21/2011 Medco Health Solutions
Inc.
Pvd pharmaceutical mgmt svcs
Express Scripts Inc.
Pvd pharmacy benefit mgmt
svcs
Stock Swap
Cash / Stock
$29,369.9
$34,305.4
$650.0
2.21%
1.89%
08/04/2011 Emdeon Inc.
Develop payment mgmt
software
Blackstone Capital
Partners VI
Private equity firm
Going Private
Cash
$2,200.5
$3,026.8
$153.0
6.95%
5.05%
08/15/2011 Motorola Mobility
Holdings Inc.
Mnfr,whl communication
prod
Google Inc.
Pvd internet search engine svc
Not Applicable
Cash
$12,102.8
$9,053.8
$2,500.0
20.66%
27.61%
08/16/2011 Renaissance Learning Inc.
Dvlp educational software
Raphael Acquisition Corp.
Private equity firm
Going Private
Cash
$436.1
$426.8
$26.0
5.96%
6.09%
$50.8
Enterprise
Value
($ M)
$673.5
Reverse
Term Fee as
a % of
Transaction
Value
0.43%
38
2011 Reverse
Transaction
Termination Fee
Detail
Date
10/03/2011 Pharmaceutical Prod Dvlp
Inc.
Transaction
Value
($ M)
$3,870.9
Enterprise
Value
($ M)
$3,387.0
Reverse
Term Fee
($ M)
$251.8
Reverse
Term Fee as
a % of
Transaction
Value
6.50%
Reverse
Term Fee as
a % of
Enterprise
Value
7.43%
Acquisition
Technique
Going Private
Consideration
Cash
Stock Swap
Cash / Stock
$2,672.3
$3,114.0
$70.0
2.62%
2.25%
Target Description
Pvd research,development svcs
Acquirer Name
Pharm Product Dvlp Inc.
SPV
10/10/2011 Complete Production Svcs
Inc.
Provide oil,gas field services
Superior Energy Services
Inc.
Provide oilfield services
10/11/2011 99 Cents Only Stores
Own,operate variety stores
Investor Group
Investor group
Going Private
Cash
$1,563.2
$1,349.3
$94.5
6.05%
7.00%
11/07/2011 Tekelec
Mnfr,whl network mgmt
equip
Titan Private Acquisition
Corp.
Investment company
Going Private
Cash
$761.8
$491.3
$40.0
5.25%
8.14%
11/07/2011 American Dental Partners
Inc.
Pvd dental practice svcs
JLL Crown Merger Sub
LLC
Going Private
Cash
$312.7
$388.4
$15.9
5.08%
4.09%
Alleghany Corp.
Pvd ppty,liability ins svcs
Stock Swap
Cash / Stock
$3,685.6
$4,306.9
$115.0
3.12%
2.67%
11/30/2011 Magma Design
Automation Inc.
Dvlp electn design software
Synopsys Inc.
Dvlp automation software
Not Applicable
Cash
$620.7
$594.7
$30.0
4.83%
5.04%
12/09/2011 Blue Coat Systems Inc.
Mnfr,whl web sec hardware
Blue Coat Systems Inc. SPV
Going Private
Cash
$1,238.2
$955.4
$73.0
5.90%
7.64%
12/14/2011 Novellus Systems Inc.
Mnfr advanced process equip
Lam Research Corp.
Mnfr wafer fabrication equip
Stock Swap
Stock
$3,010.0
$2,652.9
$120.0
3.99%
4.52%
12/16/2011 RSC Holdings Inc.
United Rentals Inc.
Not Applicable
Cash / Stock
$1,929.8
$4,186.4
$107.5
5.57%
2.57%
12/19/2011 Winn-Dixie Stores Inc.
Own,op retail grocery stores
Bi-Lo LLC
Own,operate grocery stores
Going Private
Cash
$534.2
$594.9
$72.8
13.63%
12.24%
12/21/2011 WCA Waste Corp.
Pvd waste mgmt,disposal svcs
Cod Merger Co Inc.
Investment company
Going Private
Cash
$154.1
$526.9
$16.5
10.71%
3.13%
12/22/2011 RAM Energy Resources
Inc.
Investor Group
Investor group
Going Private
Cash
$98.5
$293.7
$5.0
5.08%
1.70%
12/23/2011 Parlux Fragrances Inc.
Mnfr,whl perfumes,beauty
prod
Perfumania Holdings Inc.
Wholesale perfumes,fragrances
Stock Swap
Cash / Stock
$216.6
$204.5
$4.0
1.85%
1.96%
12/27/2011 Cogdell Spencer Inc.
Ventas Inc.
Not Applicable
Cash
$217.3
$706.0
$15.0
6.90%
2.12%
39
About Houlihan
Lokey
Houlihan Lokey is an international investment bank with expertise in mergers and acquisitions, capital
markets, financial restructuring, and valuation. The firm is ranked globally as the No. 1 restructuring
advisor, the No. 1 M&A fairness opinion
p
advisor over the p
past 10 yyears, and the No. 1 M&A advisor for
U.S. transactions under $1 billion, according to Thomson Reuters. Houlihan Lokey has been advising
clients for more than 40 years and now has 14 offices and 850 employees in the United States, Europe and
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41
Disclaimer
Disclaimer
Disclaimer
© 2012 Houlihan Lokey. All rights reserved. This material may not be reproduced in any format by any means or redistributed
without the prior written consent of Houlihan Lokey.
Houlihan Lokey is a trade name for Houlihan Lokey, Inc. and its subsidiaries and affiliates which include: Houlihan Lokey Financial
Advisors Inc.,
Advisors,
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authorized and regulated by the U.K. Financial Services Authority and Houlihan Lokey (China) Limited, a company incorporated in
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Houlihan Lokey gathers its data from sources it considers reliable; however, it does not guarantee the accuracy or completeness of the
i f
information
i
provided
id d within
i hi this
hi presentation.
i
Th material
The
i l presented
d reflects
fl
i f
information
i
k
known
to the
h authors
h
at the
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i
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43

2011 Transaction Termination Fee Study

Transcription

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