M&A Roundup: Some M&A Roster Deals Worth Noting

Banking’s Biggest Deal – For Now Acquirer: NationsBank Corp. Target: Barnett Banks Inc. Price: $14.82 billion in stock Target Business: Banking Snapshot: This is the largest bank merger completion to date and it suggests an even larger scale of banking combinations as the industry drives toward the year 2000. North Carolina-based NationsBank widened its stake in populous Florida through the deal and now claims operations along much of the Eastern Seaboard. Symbolically, the deal suggests which banks will survive the merger wave since its size denotes that banks that had been acquirers and consolidators are themselves becoming targets. Retailing Empire Gets New Territories Acquirer: Proffitt’s Inc. Target: Carson Pirie Scott & Co. Price: $867.7 million in stock Target Business: Department stores and other merchandising Snapshot: Consolidation continues in department stores, with Proffitt’s remaining a driving force. The chain has already leveraged acquisitions into a major market share in the South. Now it penetrates deeply into the Midwest by picking off one of the region’s premier retail names. Delivering the Goods in New Modes Acquirer: FDX Corp. Target: Caliber Systems Inc. Price: $2.47 billion in stock Target Business: Package deliveries Snapshot: Formerly Federal Express, FDX is still regarded as the leader in quick delivery of packages and letters, largely through its airplane fleet. But the field is more highly competitive than ever, and growth comes with difficulty. Caliber expands the company in its basic business but gives it capabilities in primarily land-based deliveries, where overnight speed is not necessarily the key element in service. Finding Niches in Industrial Trucks Acquirer: Oshkosh Truck Corp. Target: McNeilus Cos. Price: $250 million in cash Target Business: Refuse and concrete mixer truck bodies Snapshot: The Oshkosh strategy is to differentiate itself by focusing on specialized trucks and the related area of fire-fighting apparatus. McNeilus, which had been privately owned, adds a niche to the Oshkosh lines. Core competencies are not dissimilar and there is diversity in the customer base. Playing Off a Huge Platform Acquirer: Intel Corp. Target: Chips & Technologies Inc. Price: $422.9 million in cash Target Business: Integrated circuits for microcomputers Snapshot: What does Intel do for an encore after locking up nearly 90% of the market for personal computer chips? It moves into chips for smaller computing machines – a fast-growing field. Acquisition telescopes the entry for a firm traditionally dependent on R&D and serves up a major player in a more competitive tier. A Healthier Market Share Acquirer: Rexall Sundown Inc. Target: Richardson Labs Inc. Price: $85.6 million Target Business: Vitamins and nutritional supplements Snapshot: The vitamins, herbal medicines, and natural products segment of the health products market is consolidating as traditional health food outlets get bigger and mainstream pharmacies increasingly stock the “alternative” products. Rexall has been a key consolidator through acquisitions and Richardson expands its vitamins and supplements lines.