The Day In M&A: 2 August 2017

Today we look at BP, KKR, Kosmos, Unilever and Axel Springer.

It was as much a day of No’s in M&A as yes’s, with some of the euphoria of the rally in stocks for the first day of August wearing off. In terms of what was on the leaderboard in the deals space, one could argue that KKR taking over PharMerica for $1.4bn topped the bill if only on the basis is of course one of the kings in the M&A space. PharMerica is a pharmacy manager for long term care facilities.

British oil & gas giant BP which has just offered a trading update, was back in the news via its trading partner in West Africa, Kosmos. Indeed, Kosmos Energy announced its intention to list on the London Stock Exchange in September, a move specifically designed to widen the footprint of its shareholder base.

Sticking with the resources space, and Rio Tinto was updating on the status of its stake sale in the Simandou project in Guinea. If all goes well, Rio could raise as much as $1.3bn.

Also in Africa, we hear that Unilever is set to fork out £122.5m for its Nigerian unit. The primary purpose of the deal is to guard against a fall in the local currency.

As far as the No Deals were concerned, one could say that Axel Springer said it is not in talks to buy sports media platform Sport1 lead the way. Also in the negative camp was Reuters reporting that US toymaker Hasbro has pulled out of talks to buy US studio Lionsgate. As one would imagine, the alleged reason for the breakdown here was “price differences”.

Looking at Bunge, it may be the case that it is a company that wishes it had been taken over, after the latest 34% drop in quarterly earnings and the lowering of the full year outlook. Not surprisingly, the company was described as not closing the door on being sold, after perhaps rather unwisely saying no to Glencore. One wonders how the shareholders of Bunge are feeling right now?

Zak Mir is Co Founder Wallstreetwires.com, technical analyst, author, broadcaster and financial markets commentator.

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