M&A Alerts, July 25, 2008

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July 25, 2008

Top Stories

A New President: ACG Selects Gary A. LaBranche
The Association for Corporate Growth (ACG), has announced the selection of Gary A. LaBranche as President and CEO, effective September 1, 2008. LaBranche, a Certified Association Executive, has over 25 years of professional experience in managing associations. Since 2003, he has served as the President and CEO of the Association Forum of Chicagoland.

Vital Market Signs: GE Healthcare unit pays $860
General Electric's GE Healthcare unit announced it has signed a deal to purchase medical products maker Vital Signs Inc. for approximately $860 million. Under the terms of the deal, Vital Signs shareholders will receive $74.50 per share in cash for each Vital Signs share they own. The offer represents a 28.4% premium over Vital Signs' Wednesday closing stock price of $58. Vital Signs, makes products for anesthesia, respiratory, sleep therapy and emergency medicine. The deal, which is subject to Vital Signs' shareholder and regulatory approvals, in addition to other customary reviews, is expected to close in the fourth quarter of this year. Shareholders representing 37% of Vital Signs' outstanding common stock have agreed to vote their shares in favor of the deal.

More News

A Third Wave Deal: Hologic Completes Cash Tender

A Good Connection: CTDI Acquires Verso Tech

A Portfolio Check-up: HLTH Completion of Sale of ViPS

A Precise Buy: Hexagon Acquires Precision Measuring Instruments

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Database Merging: Embarcadero Technologies® Acquires CodeGear(TM) from Borland® Software

Recently, Embarcadero Technologies announced a definitive asset purchase agreement with Borland Software Corporation to purchase Borland’s CodeGear division. The acquisition price was approximately $23 million. The intent of the deal is to enable Embarcadero to address growing productivity and resource challenges, resulting from different applications and diverse database platforms. With more than $100 million in annual revenue, and over 500 employees globally, the combined companies will operate under Embarcadero Technologies.

To complete the deal, Thoma Bravo, a leading private equity investment firm in equity and strategic support—founded on the concept of "industry consolidation” or "build and buy” investing—was brought in to serve as advisor.

The challenge in managing such a deal, says Holden Spaht, Principal at Thoma Bravo, is that the deal was a spin-out transaction. “There is always a degree of difficulty with spin-outs that is higher than a transaction involving a standalone entity because you often are not inheriting any infrastructure, shared services, or back-office functions; and one needs to account for this whether one is a strategic or financial buyer. This particular transaction also provided a difficult negotiation around IP. CodeGear is the legacy of Borland and separating deeply rooted IP is not easy.” Under the terms of the deal, Borland will retain CodeGear’s accounts receivables, which are estimated to have an approximate value of $7 million. more

As bearish as some say it is there are still underline signs of health in the US economy, as Dow futures rose approximately 40 points on an increase of durable goods, which bumped 0.8% in June. We don’t yet know but it may be that the mid year 2008 was the inflection point for middle-market deals. While big deals have been limited so far this year, middle-market deals have stood up under the credit crunch, decline in US housing sales and rising US unemployment. Indeed, first quarter 2008 deal numbers were virtually unchanged from Q1 2007. The middle-market led deal making in the quarter with 82% of all Q1 deals made in the $1 million to $500 million. more

M&A Alerts are published weekly by The M&A Advisor
Roger Aguinaldo, Publisher & Editor-in-Chief
The M&A Advisor, tel.: 718.997.7900
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