Stocks That Are Targeted For Takeover May Be Risky
Some investors may be getting a little too enthusiastic about the sudden spurt in corporate mergers-and-acquisitions activity.
In recent weeks, a number of stocks that are the target of a friendly deal or hostile approach have begun trading higher than the offer price that's on the table. From Pechiney SA to Dana Corp. to Circuit City Stores Inc. to Clayton Homes Inc., stock prices are leaving bids behind in the dust.
It isn't unheard of for a takeover stock to trade above a bid: Shares of a target frequently rise on speculation that a friendly or hostile suitor will raise its offer or that another bidder will jump into the fray at an even higher price. Indeed, hostile bidders often snare their unwilling prey by sweetening the pot.
But in several of the current situations, the move may reflect more wishful thinking than reality -- at least for now. "People are beginning to assume this is a very good market to conduct mergers and acquisitions," says Andrew Whittaker, a big player in takeover-trading bets as global head of arbitrage research at Lehman Brothers. He warns, however, "If you're just going naked long on these stocks, that is probably imprudent."
Consider Dana, a maker of auto parts that earlier this month received a hostile bid of $2.2 billion, or $15 a share, from smaller rival ArvinMeritor Inc. Shares of Dana, which were trading below $12 before the bid, quickly shot up above $16.
The stock has retreated a bit since then, and was at $15.52 Friday in 4 p.m. trading on the New York Stock Exchange.
So far, Dana hasn't responded to the hostile bid, although it is widely expected to reject the offer in coming days. To be sure, ArvinMeritor has indicated a willingness to sweeten its offer and Dana could eventually agree to sell itself to ArvinMeritor or another suitor at a higher price.
But in bidding up Dana's stock price, investors are shrugging off several facts that could limit the prospects for a quick sale. Among them: ArvinMeritor hasn't disclosed definitive financing for a deal, antitrust issues could delay any transaction, and Dana is well-protected against a hostile approach until next year. Furthermore, Dana is incorporated in Virginia and based in Ohio -- two states that have laws protecting hometown companies against hostile bids. Dana's headquarters is in Toledo.
"Given that there are significant hurdles to completing the proposed transaction, we believe it is in shareholders' best interest to trim positions now and lock in the bid-driven windfall gain," analyst Michael Bruynesteyn of Prudential Financial wrote in a report to clients after the bid, when the stock was above $16.
Then there's Circuit City Stores. The big electronics retailer received an unsolicited offer last month from Mexican investor Carlos Slim, who already holds a 9.2% stake in the company. Mr. Slim offered to buy the remaining shares for $8 a share, or about $1.5 billion. Circuit City, which is in the midst of a turnaround, rebuffed the offer.
"Although some short-term upside may still exist, we believe the risk/reward of Circuit City shares is currently unattractive," Scot Ciccarelli, an analyst at Gerard Klauer Mattison, wrote when the stock was trading at $8.66 late last month.
Since then, the stock has risen further even though Mr. Slim isn't expected to bump his bid soon. The stock was at $9 on Friday in 4 p.m. trading on the New York Stock Exchange.
Deal makers attribute much of the exuberance to professional investors specializing in takeover stocks -- called arbitragers -- who have been relatively idle during the recent dearth of deals.
"The arb funds have been completely on the sidelines for a year. They have been allocated pools of money and now they are actively investing again," says Louis P. Friedman, global head of mergers and acquisitions at Bear Stearns Cos.
Even in some friendly transactions, sellers' prices are trading above the deal price. Late last month, for example, Fisher Scientific International Inc. agreed to buy Perbio Science AB, a Swedish biotech-research concern, in a friendly transaction valued at $714 million. The deal values Perbio at 142.50 Swedish kronor ($17.37), representing a 14% premium to the recent stock price, but the stock immediately jumped 18% on hopes that another bidder would emerge. So far at least, that hasn't happened. Currently, Perbio is at 148 kronor on the Stockholm exchange.
Clayton Homes Inc. is another example. The maker of prefabricated homes agreed to sell itself to Warren Buffett's Berkshire Hathaway Inc. in April for $1.7 billion, or $12.50 a share. But the stock rose above $13 a share when some big investors began lobbying others to vote against the deal, saying it undervalued the company.
The shares moved higher even though the founding Clayton family owns 28% of the stock and supports the transaction. Last week, Clayton delayed the vote for two weeks until July 30, after private-equity firm Cerberus Capital Management Inc. expressed interest in Clayton , though it didn't put a formal bid on the table.
Although they are bidding up shares aggressively, takeover traders, some of whom have been burned badly by deals that flopped in the late 1990s, are trying to protect themselves if their bets go wrong. In addition to scooping up shares of targets, they are also playing in the options market in these same situations in order to hedge their positions.
History shows investors may have reason to be cautious. In December, Rational Software Corp. agreed to be acquired by International Business Machines Corp. for $10.50 a share, or $2.1 billion. But some investors immediately considered that deal to be at a low price. The stock traded as high as $10.74 on hopes that another bidder would enter the fray.
It was the wrong bet. No other bidder emerged, and IBM completed the Rational deal on the original terms two months later.
并购概念股存在风险
一些投资者对于蜂拥而来的公司并购活动可能有些过分热衷。
近几周来，许多成为善意或敌意收购目标的公司股票，其交易价格已经超过收购公司提出的报价。从普基公司(Pechiney S.A.)到德纳公司(Dana Corp.)、再到Circuit City Stores Inc.和Clayton Homes Inc.等，其股价已将收购报价远远抛在身后。
成为收购目标的公司其股价超过收购报价并非前所未闻的事情。有望被收购的公司，其股价通常出现上扬。其原因是，市场预计寻求善意或敌意收购的公司将会提高报价，或者在此过程中其他买主也可能突然参与角逐。而且，寻求敌意收购的公司往往提出更加诱人的条件来吸引不大情愿的收购对象自投罗网。
但是，从当前的几种情况来看，上述公司股价上扬可能主要由于市场人士一厢情愿，而非基于并购的具体进程。
雷曼兄弟公司(Lehman Brothers)负责套利交易研究的全球主管安德鲁．惠特克(Andrew Whittaker)称，人们认为，目前市场具有良好的并购条件，但他警告称，如果过度持有这些股票的多头头寸，可能是不大明智的。
就拿汽车配件生产商德纳公司来说，该公司于本月早间收到来自规模较小的竞争对手ArvinMeritor Inc. (ARM)发出的22亿美元的敌意收购要约，合每股15美元。德纳公司在收到上述收购要约之前，其股价不足12美元，而此后便迅速升至每股16美元，其股价随后有所回落，纽约证交所上周五收盘时，为15.52美元。
德纳至今未对上述敌意收购作出回应，但是，市场普遍预计，该公司将在未来几天提出拒绝接受上述收购。然而，ArvinMeritor业已表示，愿意提出更加优惠的收购要约，而且如果ArvinMeritor或其他买主提出更高的收购价格，德纳可能最终同意接受收购。
但是，在推高德纳股价的过程当中，投资者对于可能阻碍迅速完成出售的诸多现实情况并未给予足够的重视。其中包括，ArvinMeritor并未披露实施收购的具体财务条款，反垄断问题可能推迟收购进程，而且德纳受到很好的保护，明年之前可望避免遭到敌意收购。此外，德纳是在弗吉尼亚州注册的公司，而公司所在地是在俄亥俄州。这两个州都有保护当地公司免遭敌意收购的法律。德纳公司的总部设在托莱多。 Prudential Financial的分析师迈克尔．布鲁涅斯汀(Michael Bruynesteyn)在获得上述收购消息后向客户发出的一份报告称，鉴于在完成拟议的收购方面存在明显障碍，他认为，目前减持头寸并在收购消息推动股价意外走高之后获利回吐，这符合股东的最佳利益。在他发出上述报告时，该股股价超过16美元。
Circuit City Stores的情况也与之相似。这家大型电子产品零售商上月突然收到墨西哥投资者卡洛斯．斯利姆(Carlos Slim)的发出的收购要约。斯利姆目前已经持有Circuit City公司9.2%的股份。他提出以每股8美元、共计15亿美元的价格收购剩余的股份。正在努力改善业绩的Circuit City断然拒绝了上述收购要约。
Gerard Klauer Mattison的分析师司格特．斯卡瑞利(Scot Ciccarelli)称，尽管该股可能还有短线上扬的机会，但他认为该股的风险/回报比率目前已不具吸引力。他是在上月底该股达到8.66美元时作出上述评论的。
在此之后，尽管市场预计斯利姆近期不会上调收购报价，但该股继续上扬。纽约证交所上周五收盘时，该股价格达到9美元。
并购行业的人士认为，这种高涨的市场人气主要受到利用股票收购消息从事套利交易的职业投资者所推动。由于近来并购交易稀少，导致套利交易人士一直无所事事。
贝尔斯登公司(Bear Stearns Cos)全球并购交易的主管路易斯．弗里德曼(Louis P. Friedman)称，套利基金游离于场外已有一年时间，他们积累了大量资金，目前又在进行活跃的交易。
即使是那些成为善意收购对象的公司，其股价也高出了收购出价。例如，上月，Fisher Scientific International Inc.宣布，同意以7.14亿美元现金，对瑞典生物学科技研究公司Perbio Scientific AB进行善意收购。上述交易将Perbio的价格定为每股142.50瑞典克朗（合每股17.37美元），较该股当时价格高出14%，但是，由于市场人士预计将有其他买主提出收购，该股价格迅速飙升了18%，斯德哥尔摩证交所该股最近的价格达到148克朗。
Clayton Homes Inc.也是一个例证。这家预制房屋生产商4月17日表示，同意以17亿美元的价格将其本身出售给沃伦．巴夫特(Warren Buffett)管理的Berkshire Hathaway Inc.，合每股12.50美元，但是，当一些大股东称上述交易低估了公司价值并敦促其他人士反对接受交易的时候，该股升至13美元以上。
尽管创建该公司的克雷顿(Clayton)家族支持进行上述交易，但是该股依然出现上扬。克雷顿家族持有该公司28%的股份。上周，在私人股份公司Cerberus Capital Management Inc.表示对Clayton颇有兴趣之后，Clayton将收购表决推迟了两周，至7月30日。但是，Cerberus Capital Management尚未提出正式收购要约。
虽然从事并购套利的交易员们大举推高收购对象的股价，但是，一些由于20世纪90年代末期并购失败而遭受重大损失的交易员们力争避免因为事态出现意外发展而再次遭受损失。他们在推高收购对象股价的同时，在期权市场积极展开交易，从而对冲其头寸。
历史的经验显示，投资者的谨慎操作不无理由。去年12月份，Rational Software Corp.同意接受国际商业机器公司(International Business Machines Corp.)发出的21亿美元、合每股10.50美元的收购要约。然而，一些投资者立即认为，上述收购价格过低，他们指望其他公司参与对该公司的竞购，并将Rational Software的股价推高至10.74美元。
然而，他们的希望落空了，并没有其他公司参与竞购，国际商业机器公司于两个月后按照最初的协议条款完成了对Rational Software的收购。
