DealZone

Deals wrap: Schneider fails to quash Tyco buyout rumors

Schneider Electric HQSchneider Electric issued a statement denying it had planned to buy U.S. conglomerate Tyco International, but this did little to kill the buyout talks as a source with knowledge of the matter said the French engineering group held earlier talks with Tyco.  Shares of Schneider initially rose more than 2 percent after the denial but dropped after analysts made comments speculating a tie-up may be coming soon, and is expected to weigh on shares in the long term.

BP’s tie-up with Rosneft was at risk of collapse on Wednesday as the state-controlled Russian oil major said it would not extend a Thursday deadline on a $16 billion share swap. The possible failure of the deal would hurt CEO Bob Dudley, who on Thursday faces shareholders angered by the Gulf of Mexico disaster as BP holds its annual general meeting.

MGM has disclosed the planned structure of its initial public offering in the Macau casino market, reaching an agreement with co-owner Pansy Ho. In the agreement, Ho would receive a 29 percent stake in the company, MGM China Holdings Ltd. An IPO would make MGM Macau the last of Macau’s six gambling licensees to go public.

Packaging company Silgan Holdings said it will acquire Graham Packaging in a $4.1 billion deal as it seeks to grow abroad. The deal will close in the second half of the year and is expected to generate free cash flow of $500 million and add to Silgan’s first-year earnings.

The Malkin family, who control New York’s Empire State Building is planning to create a publicly traded real estate company featuring the iconic building, according to sources reported in the New York Times. The 102-story Art Deco skyscraper is a hot spot for tourists, but the Malkins will have to clear a number of hurdles before the plans can go through, including gaining the support of its principle partner.

from Breakingviews:

Miramax needn’t be an MGM disaster sequel

One of Hollywood's biggest flops has been Metro-Goldwyn-Mayer. So Tinseltown financiers are understandably puzzled over what looks like a forthcoming sequel to the MGM solvency horror story: a buyout of Miramax.

From the opening credits, the $660 million deal resembles the 2004 takeover of the studio behind James Bond by Providence Equity Partners and TPG. The starring roles this time go to Colony Capital and a California real estate executive, Ronald Tutor. They paid substantially more than other bidders -- including Miramax founders Bob and Harvey Weinstein -- were offering.

Moreover, the investment strategy is predicated on the idea of milking Miramax's storehouse of some 700 films. That was the same premise of the MGM buy and its $4.9 billion enterprise value. But the script didn't go as planned, leading to MGM's private equity owners pretty much washing their hands of the deal. Bidders for MGM have valued its assets at around $1.6 billion and its lenders have granted the company forbearance on its loans until next month. In short, it's not a winning formula.

DealZone Daily

Time Warner is considering making a second-round bid of up to $1.5 billion for Hollywood studio Metro-Goldwyn-Mayer, a source tells us. The March 19 deadline for the bids for MGM — whose film library includes the James Bond and Pink Panther franchises — may well be extended.

Shares in Arrow Energy have been suspended — the suspicion is that Royal Dutch Shell and Petrochina will sweeten their joint $3 billion offer for the Australian gas producer. Read the Reuters story here.

And as I am writing this, London-listed Gulfsands Petroleum is saying that it has rejected a preliminary takeover approach. The suitor is Indian, it has also said, but it’s not ONGC. To be continued.

DealZone Daily

Hershey is still working on a bid for Cadbury that would top Kraft’s 10.5 billion pound bid for the British confectioner. As the clock ticks down for rivals to enter the fray, Hershey — the one remaining party to declare its hand — has still not decided if it will table a formal offer, but has authorized the drawing up of a bid. At the same, Kraft has stepped up the charm offensive with Chief Executive Irene Rosenfeld visiting Cadbury shareholders in London. She has found some doors shut, however, indicating that investors find the bid too low.

First round bids for debt-ridden film studio MGM are due on Friday, with 12 companies having expressed an interest in the business, including rivals Time Warner and Lions Gate Entertainment, as well as Liberty Media, News Corp and private equity firms. Non-binding bids for the studio, controlled by a consortium of private equity and media firms, are expected to come in at $1.5 billion to $2 billion, way below $3.7 billion it owes its lenders.

Telecoms billionaire Carlos Slim has launched a $21 billion bid to unite Telmex and Telmex Internacional with Latin America’s top mobile phone provider America Movil. Slim, who controls all three companies, wants to create a leading fixed-line, mobile and internet services company to stave off competition from rivals.

from MediaFile:

MGM Studio: CEO Sloan out, turnaround star Cooper in

Debt-ridden Hollywood studio MGM, whose library is home to such gems as the Rocky and James Bond flicks, has replaced CEO Harry Sloan, appointing a three person team to run the show: famed turnaround ace Stephen Cooper, motion pictures group boss Mary Parent, and CFO Bedi Singh.

Sloan is out as CEO but the veteran Hollywood businessman, who took the helm a few months after MGM's 2005 buyout by a group of private equity and media investors,  will stay on MGM as non-executive chairman of the studio. The studio has been grappling with a massive $3.5 billion debt load stemming from its 2005 buyout by private equity and media firms.

Along with the debt load, MGM , which has not had a major film release since Tom Cruise's "Valkyrie"  in December, has been struggling like other Hollywood studios with  lining up fresh film financing due to the economic crunch and dropping DVD sales.