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Biggest Merger Monday in Awhile: TIF, AMTD, MDCO & More

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Monday, November 25, 2019

 

Expect to hear a lot of talk about consumer spending this week — it’s the Monday before Black Friday, and we’ve got a shortened trading week. As such, we’ll see somewhat fewer economic data reports, and Q3 earnings season is starting to wrap up.

 

But first, speaking of “wrapping up”…

 

This morning is the biggest Merger Monday we’ve seen in quite some time. Beginning with the sale of Tiffany & Co. (TIF - Free Report) to French luxury conglomerate LVMH (Louis Vuitton Moët Hennessy) for $16.2 billion, or $135 per share. This is higher than the $14.5 billion offer from LVMH a month ago, at which time Tiffany’s share price shot up 32% on the news. In today’s pre-market, Tiffany shares are up an additional 5.7%, with LVMH up 1.2%.

 

Analyst look for this deal to boost Tiffany’s lagging international sales performance. The French luxury giant — which also owns Christian Dior, Bulgari and dozens of other brands — would likely consider this its wheelhouse; thus we like the synergies of this deal based on reports we’ve seen thus far.

 

Also, as initially reported last week, Charles Schwab (SCHW - Free Report) will indeed go ahead with its buyout of TD Ameritrade (AMTD - Free Report) for $26 billion, in an all-stock transaction. Combined, this company will control a whopping $5 trillion-plus in assets under management. This should also effectively bring an end to the trading services price war between the two companies. Ameritrade shares are up 3.5% on the news, while Schwab is down 0.43% at this hour.

 

The Medicines Company (MDCO - Free Report) has agreed to terms with Swiss pharmaceutical giant Novartis (NVS - Free Report) , and will be purchased for $9.7 billion, or $85 per share, in all cash. This is a 45% premium from the trading close of Medicines Co. prior to this transaction first being announced. Chief among assets entering Novartis’ portfolio is inclisiran, a cardiovascular drug that may “revolutionize” treatment of the disease. Medicines Co. shares are up 22.7% in today’s pre-market, while Novartis stock is down only 0.04%. The expected close for this deal is early next year.

 

This morning, word is that eBay (EBAY - Free Report) will sell its StubHub business to another Swiss company, Viagogo, for $4.05 billion in all cash. The StubHub business had been dangled since last summer, and it looks as though it now has a taker. The sale is expected to complete in the first quarter of 2020.

 

Mark Vickery

Senior Editor

 

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