CB&I and Shaw in $3 B Deal, Roper to Buy Sunquest for $1.4 B

Arthi Gupta
30 Jul, 2012
New York City

U.S. indexes struggled and CB&I agreed to acquire Shaw Group for $3 billion in a cash and stock transaction. Roper agreed to acquire Sunquest for $1.415 billion. European leaders reaffirmed their commitment to the euro and indicated decisive and coordinated action as early as this week.

[R]8:50 AM New York – U.S. indexes pared gains. CB&I will acquire the Shaw Group for about $3 billion in a cash and stock transaction. Roper agreed to acquire Sunquest for $1.415 billion.[/R]

U.S. indexes were cautious in the pre-market trading and awaited concrete actions from the European Central Bank in support of the euro and troubled bonds of the peripheral nations in the currency union.

Investors look ahead to the monthly non-farm payrolls report apart from data on personal income and spending and the weekly jobless claims report.

HSBC set aside $2 billion to cover the regulatory fines and fees stemming from various inquiries.

The UK and China based bank said it has places $700 million in reserves for the potential charges from the money laundering investigation and additional $1.3 billion for the regulatory settlement related to payment protection plans consumer loans and home loans.

European indexes advanced after more political leaders offered support for the currency union and market expectations remain high that the European Central Bank will follow up with action to buy more bonds of Italy and Spain.

Markets in Asia closed higher on the hopes that the European Central Bank and political leaders will devise a solution to arrest the widening debt contagion in the region.

Market indexes in Japan gained 0.8%, in India surged 1.8% and in Hong Kong added 1.6%.

Japan''s industrial output fell 0.1% from a month ago in June.

CB&I to Acquire Shaw Group

CB&I, the energy infrastructure projects engineer will acquire the Shaw Group for approximately $3 billion or $46 per share in a cash and stock transaction.

Under the terms of the agreement, Shaw’s shareholders will receive $41 in cash and $5 in CB&I equity for each share of Shaw stock at closing.

Roper to Buy Sunquest

Roper Industries, Inc. agreed to acquire Sunquest Information Systems, Inc., the provider of diagnostic and laboratory software solutions to healthcare providers, in an all cash transaction valued at $1.415 billion, including $25 million in cash tax benefits.

Roper expects the acquisition of Sunquest to be immediately cash accretive and to generate $140 million or more of EBITDA in 2013.

Earnings Review

Loews Corporation ((L)), the diversified holding company said second quarter total revenues declined to $3.39 billion from $3.54 billion a year earlier. Net income in the quarter fell to $56 million or 14 cents per diluted share compared to $250 million or 61 cents per share, in the quarter a year ago.

MWI Veterinary Supply, Inc. ((MWIV)), the animal health products distributor said third quarter total revenues improved 35% to $554.7 million from $410.7 million in the previous year. Net income was $14.5 million for the quarter, 27.3% higher than net income for the same period in the prior fiscal year. Diluted earnings per share were $1.15 for the quarter compared to $0.91 for the same period in the prior fiscal year.

Roper Industries, Inc. ((ROP)), the engineered products producer reported second quarter revenue increased 4% to $725 million. Net earnings for the quarter were $115 million, an 8% increase over the second quarter of 2011. Diluted earnings per share were $1.15.

UNS Energy Corporation ((UNS)), the utility subsidiaries operator said second quarter total operating revenues decreased 0.7% to $367.17 million from $369.67 million in the comparable quarter a year ago. Net income in the quarter dropped to $26.3 million or 64 cents per diluted share compared to $28.6 million or 71 cents per share last year.