Filings from June 22-28

Spin Offs:

Northstar Asset Management Group Inc. continues their spin off of managed assets.

Halyard Health, Inc. is Kimberly Clark Corporation’s (KMB) health care subsidiary. Kimberly Clark is best known for it’s personal hygiene items such as Kleenex, Huggies, Kotex, etc. The health care division has been a segment for many years, which is providing surgical and infection prevention in addition to medical devices. Halyward Health appears to be a small segment (~7% of sales) of Kimberly Clark, which allows for investors to overlook this division. That said, it is a large enough division for many institutional investors to be able to participate. I deeper look is warranted.

Vornado Realty Trust (VNO) will spin off a yet to be named entity that will be another strip mall REIT, similar to the Simon transaction. As the trend continues, the assessment taken here is based on valuation from FFO and leverage. The REITs are in essence investments in the underlying real estate with management of those assets. The only difference would be based on very different valuations based on different types of real estate. This is not the case in the commercial real estate versus the strip mall real estate.

Entrada Midstream is spun off from QEP Resources, Inc. (QEP). This spin off is similar to the Chesapeake Energy spin off. There will be debt that is issued and distributed back to QEP Resources. The first glance of the business shows declining revenues, operating cash flows, and income with increasing working capital and fixed asset requirements. This does not appear to be a great investment, but depending on the pricing of QEP and their plans for using the cash, there might be some value there.

Mergers:

Forms were unintentionally excluded in prior postings. They have been added this time and any other items missing will be added as they become known.

PetroLogistics LP (PHD) is being bought by Koch Industries for cash.

Valeant Pharmaceuticals lnternational, Inc. (VRX) will take over Allergan , Inc. (AGN) for stock and/or cash with private placement of debt financing if needed.

Winthrop Realty Trust (FUR) continues to plan its liquidation and allowing a more appropriate use of the FUR ticker.

Horizon Pharma, Inc. (HZNP) and Videra, a private Irish company, will merge under a cash and stock transaction.

MKTG, Inc. (CMKG) and Aegis Media Americas will merge for cash.

First Citizen’s BankShares (FCNCA) will merge with First Citizen’s Bancorporation as a share swap.

Coviden (COV) and Medtronic (MDT) will merge for cash.

Integrys Energy Group (TEG) and Wisconsin Energy Corporation (WEC) will merge for cash and equity.

Shire Plc (SHPGY) and AbbVie will not merge under their cash offer.

Texas Industries Inc (TXI) and Martin Marietta Materials, Inc (MLM) will merge with MLM issuing debt and using a trade receivable facility in addition to cash on hand to finance this transaction. As this debt offering appears to be a normal transaction and not to the benefit of the  shareholders, it was ignored.

Augusta Resource Group (AZC) and Hudbay Minerals Inc. (HBM) will merge for cash and stock.

CBS Corporation (CBS) and CBS Outdoor Americas, Inc. (CBSO) will merge for class B stock.

Forest Laboratories Inc (FRX) and Actavis Inc (ACT) will merge for cash and stock.

Weyerhauser (WY) and Tri Point Homes (TPH) will merge the Weyerhause real estate company that was going to be spun off. The transaction will be for stock.

MTR Gaming Group Inc. (MNTG) and Eldorado HoldCo LLC continue the cash or equity merger.

Georgia-Carolina Bancshares (GECR) and State Bank Financial Corporation (STBZ) will merge for a cash and stock transaction.

Kraton Performance Polymers, Inc. (KRA) and LCY Chemical Corp. (1704.TW) will merge for equity.

Overland Storage Inc (OVRL) and Sphere 3D Corporation (SPIHF) entered into an arrangement for special warrants. This is one to look at for more details to come soon.

Inland Diversified Real Estate, Inc. (IRC) and Kite Realty Group Trust (KRG) for equity.

Forest Oil Corp (FST) and Sabine Oil and Gas LLC, a private company, will merge for equity.

Zalicus Inc. (ZLCS) and Epirus Biopharmaceuticals, Inc. will combine for equity.

Triquint Semiconductor Inc. (TQNT) and RF Micro Devices Inc. (RFMD) will merge for equity.

Time Warner Cable (TWC) and Comcast (CMCSA) continue their merger for cash and equity.

Orbital Science Corp. (ORB) and an Alliant Technology (ATK) spinoff of ATK Aerospace for cash and equity. This deserves a bit of a look only because it combines elements of the analysis here.

C&J Energy Services (CJES) and Nabor’s are merging to get the tax advantages of Bermuda using cash and equity.

QLT, Inc. (QLTI) and an Atrix Laboratories subsidiary will merge for cash and equity.

Iron Mountain is merging with itself to become a REIT.

Foster Wheeler AG (FWLT) and AMEC plc (AMEC.L) will merge for cash and equity.

Brookdale Senior Living (BKD) and Emeritus Corp (ESC) will merge for equity.

Aspen Insurance Holding Company (AHL) and Endurance Specialty Holding (ENH) will merge for cash and equity.

IPOs:

A decision has been made to exclude new offering for non-stub related companies. While GoPro showed this week that gains can occur in new issuances, the expectation is that readers of this blog will not have access to those shares prior to market opening, will not see the road show, etc. Additionally, it is expected that due to the intense investment banking marketing efforts, there is less likely undervalued issuances to be found. That said, this idea is not fixed and any feedback would be appreciated.

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