Top corporate deals that grabbed world headlines this month

Highlights

  • Apollo Global Management, Inc. (NYSE: APO) will acquire Lumen’s ILEC asset in 2022.
  • Brookfield Asset Management Reinsurance Partners Ltd (NYSE: BAMR) will acquire American National Group Inc (Nasdaq: ANAT) for US$5.1 billion.
  • Cargill and the Continental Grain Company will purchase Sanderson Farms (Nasdaq: SAFM) for US$4.53 billion or US$203 per share.

Several major mergers and acquisitions have grabbed the world headlines in 2021. In August, four major deals have been in the limelight. These activities highlight the increasing corporate confidence in a new business environment post the corona pandemic and reaffirms its resilience in the face of a crisis.

Here we look at the four important deals that grabbed investors’ attention this month.

  1. On August 3, Apollo Global Management, Inc. (NYSE: APO) and Lumen Technologies, Inc. (NYSE: LUMN) announced that the former would acquire the latter’s ILEC assets for US$7.5 billion.

As per the initial agreement, the Apollo Funds will acquire Lumen’s ILEC assets, which has operations across 20 states in the US. The deal is likely to close next year. However, the terms of the deal are yet to be decided.  

Apollo Global is a major investment manager with global operations. The company raises funds, invests, and manages mortgages, private equity, investment accounts, and institutional and individual investors.

  1. On August 9, Brookfield Asset Management Reinsurance Partners Ltd (NYSE: BAMR) announced plans to acquire the American National Group Inc (Nasdaq: ANAT) for US$5.1 billion. As per the agreement, BAMR will pay US$190 for each ANAT stock in cash to the American National shareholders.

The deal is likely to be completed in the first half of next year. BAMR will complete the purchase through a mix of stocks and debt financing, about US$1.5 billion.

Also read: Are these six blue-chip stocks primed to lead the banking recovery?

Brookfield runs a reinsurance business. It provides financial solutions to insurance companies and their stakeholders. On the other hand, ANAT provides health, property, and casualty insurance.

  1. On August 4, VICI Properties (NYSE: VICI) announced plans to buy its rival MGM Growth Properties LLC (NYSE: MGP) for US$17.2 billion in an all-stock deal, including MGP’s debt.

The valuation is done based on VICI’s current stock price of US$29.78. As per the deal, VICI would give its 1.36 shares for each share of MGM. 

The deal would make VICI the largest real estate investment trust (REIT) with a valuation of US$45 billion. The date of the deal is not fixed yet.

Source: Pixabay.

MGM Growth Properties is a real estate investment trust that acquires properties for entertainment, casinos, resorts, etc. On the other hand, VICI acquires properties for gaming, hospitality, and the entertainment industry. 

Also read: Styling it right: Six fashion stocks that are hard to miss

  1. on August 9, Cargill and the Continental Grain Company revealed plans to acquire Sanderson Farms (Nasdaq: SAFM) for US$4.53 billion or US$203 per share in an all-cash transaction. Sanderson is the third-largest poultry farm in the US.

Cargill’s poultry arm Wayne Farm will merge with Sanderson to form a new poultry business. Cargill produces oilseeds and other farms products and provides consultation to farmers.

Bottom line

The mergers and acquisitions are expected to continue in the coming quarters as businesses recalibrate their market strategies post the Covid-19 pandemic. It reflects the corporate world’s growing confidence in the prospects for a strong economic recovery.

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