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mergers & acquisitions Archives

Nvidia makes a potentially risky acquisition

California residents may have heard the news that Nvidia has acquired Mellanox for $125 per share. This translates to a 5.5 percent premium and a total purchase price of $6.9 billion. Although the price is thought to be fair for both parties, it is seen as a risky acquisition for Nvidia. It is thought that there may be limited opportunities for synergy between the two businesses.

BlackBerry acquisition aims to enhance cybersecurity business

BlackBerry, one of the originators of secure smartphone technologies, has become a billion-dollar security company with products aimed at the business market. In February, the firm acquired Cylance, a California-based, privately-held cybersecurity and artificial intelligence company, for $1.4 billion. According to BlackBerry's CEO, the company aims to become the world's largest firm in both fields, offering a range of products to businesses who want to ensure that their employees can communicate securely across a range of platforms.

Appeals court gives approval for AT&T takeover of Time Warner

In a case that is of interest to many Californians, a massive merger of media giants has been affirmed by the U.S. Court of Appeals for the Federal Circuit. The decision paves the way for AT&T to take over Time Warner for $81 billion.

Merger builds stronger cybersecurity firm

Cylance, a California-based artificial intelligence and cybersecurity firm, has been acquired by BlackBerry, the security firm that originated as one of the leaders in mobile technology. The chairman of BlackBerry said that the acquisition reflects the company's goal of becoming a leader in the AI and security fields. Because BlackBerry contained secure messaging as a part of its platform from its early days, it was well-positioned to include other cybersecurity companies' products within its overall approach. The company stated that its goal is to allow other businesses to create secure communications between their users.

Understanding acquisitions of other businesses

Companies in California may want to expand by purchasing another firm through an acquisition. There are a number of ways that companies can merge with or buy another firm and different structures that the resulting business can take. The way in which an acquisition proceeds depends on how the other company is owned. When the other business is privately held, the owners of the business can decide the selling price and other criteria involved in the purchase. In many cases, buying a privately owned business is a faster, more flexible process than buying one that is publicly traded on the stock market.

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Through a deal valued at approximately $66 billion, Sun Trust and BB&T have agreed to merge into a new bank. The combined financial institution has yet to be named and will be headquartered in Charlotte, North Carolina. After the merger is complete, the newly-formed bank will be the sixth-largest in the United States based on assets and deposits.

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SiriusXM and Pandora have completed their merger, making SiriusXM the world's largest audio entertainment company. The merger combines SiriusXM's curated and exclusive subscription-based content with Pandora's highly-personalized, free streaming platform. As a result of the transaction, SiriusXM is now able to reach more than 100 million listeners with the company's audio products.

An overview of the merger process

Companies in California may wish to merge with others in the state or elsewhere to increase market share or meet other goals. Generally speaking, businesses involved in a merger have similar products or those that fit well with what the other provides. However, this is not always the case. The first step in the merger process is to propose an operating structure and present it to each company's board for approval.

Red Hat to merge with IBM

California investors who own shares of Red Hat were invited to vote on a proposed merger with IBM. Roughly 141 million shareholders voted to approve the $34 billion proposal. The proposed deal is for $190 per share, which was about 60 percent more than what shares were valued at when it was announced in October 2018. A regulatory filing revealed that the shares were worth about $175 when the vote was taken.

Health care industry mergers on the rise

Some of the largest mergers in California and across the country are those affecting health care companies. Since 2008, the size of businesses for sale in the sector has grown annually by 13.8 percent. In 2018, the average valuation of a business for sale in the industry was $409 million. Hospital and health care mergers are a hot topic, with consolidation in the industry moving forward as smaller partners look to increase earnings.

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