Hertz to Buy Dollar Thrifty, Apple Wins Round One Against Samsung

Arthi Gupta
27 Aug, 2012
New York City

U.S. indexes traded higher ahead of Fed Chairman Bernanke speech. A California jury awarded $1 billion to Apple Inc in a patent lawsuit against Samsung that may be trimmed on the appeal. Hertz agreed to acquire Dollar Thrifty for $2.3 billion and Deltek agreed to go private for $1.1 billion.

[R]9:55 AM New York – U.S. indexes traded higher ahead of Fed Chairman Bernanke speech. A California jury awarded $1 billion to Apple Inc in a patent lawsuit against Samsung that may be trimmed on the appeal. Hertz agreed to acquire Dollar Thrifty for $2.3 billion and Deltek agreed to go private for $1.1 billion.[/R]

U.S. indexes advanced ahead of a speech by Fed Chairman Bernanke as central bankers from around the world gather for the annual meeting in Jackson Hole, Wyoming.

In the week, investors are awaiting the release of personal income and spending and consumer sentiment data and the weekly jobless claims report.

European markets are trading higher despite disappointing German business confidence data on the hopes that the central bank in the region is working to offer more support to the sovereign bond market.

Germany raised €1.975 billion from the sale of its 12-month treasury bills known as Bubills, Bundesbank said.

The average yield rose to -0.0246% from -0.0540% in the previous sale on July 23. The bid-to-cover ratio fell to 2 from 2.3.

Asian markets edged lower after China''s industrial profits declined 5.4% annually to 366.8 billion yuan in July following a 1.7% drop in June, the National Bureau of Statistics reported. The decline was the fourth consecutive monthly fall.

Apple Wins Round One in Patent Case]

Apple Inc. has been awarded $1.05 billion in damages in a smartphone patent lawsuit against Samsung Electronics Co.

A U.S. federal court jury on Friday after deliberating for less than three days announced a verdict that focused on patents that are considered “non-utility” patents that are more focused on the design of the product and less on the technology that drives the devices.

Samsung said that it will appeal the verdict and the case is likely to move to a higher court and may reach Supreme Court as both companies are locked in a fight over patent issues in at least six nations.

Earlier in the week, a judge in South Korea awarded a mixed verdict that found both parties guilty of violating patents but the ruling is likely to have a limited impact.

Hertz to Acquire Dollar Thrifty

Hertz Global Holdings, Inc., the car rental company agreed to acquire Dollar Thrifty Automotive Group, Inc. for $87.50 per share in an all-cash transaction valued at approximately $2.3 billion.

The offer represents an 8% premium over Dollar Thrifty''s closing stock price of $81 on Friday’s close.

Hertz also agreed to sell the Advantage business to Franchise Services of North America and Macquarie Capital. The closing of that divestiture is conditioned upon, among other things, Hertz completing an acquisition of Dollar Thrifty.

Hertz anticipates at least $160 million of annual cost synergies from the transaction.

Deltek to Be Acquired By Thoma Bravo

Deltek, Inc., the enterprise software and information solutions provider agreed to be acquired by Thoma Bravo, LLC, the private equity investment firm in an all-cash transaction valued at approximately $1.1 billion or $13 per share in cash.

The $13 per share offer price represents a 7% discount to Deltek’s stock price on August 24 and a 24% premium over Deltek’s stock price on June 11.

IAC to Buy About Group

The New York Times Company agreed to sell its About Group, which includes the Web sites of About.com, ConsumerSearch.com and CalorieCount.com, to IAC Interactive for $300 million in cash.

The transaction is expected to close in the next several weeks. The company intends to use the proceeds for general corporate purposes.

TPC Group Goes Private

TPC Group Inc. entered into a merger agreement with investment funds sponsored by First Reserve Corporation and SK Capital Partners. The transaction valued at approximately $850 million, including net debt.

Under the terms of the merger agreement, TPC Group stockholders will receive $40 a share in cash for each share of TPC Group common stock that they own, representing a 20% premium to TPC Group''s closing stock price on July 24.

Trimble to Purchase TMW Systems

Trimble agreed to acquire privately-held TMW Systems Inc., a provider of enterprise software to transportation and logistics companies in an all cash purchase price of $335 million. The transaction may close in the fourth quarter.

Earnings Review

Donaldson Company, Inc. ((DCI)), the filtration systems manufacturer reported fourth quarter net sales increased 5% to $657 million from $625 million last year. Net income in the quarter increased 8% to $71 million or 47 cents per diluted share from $66 million or 42 cents per share last year.

Shanda Games Ltd. ((GAME)), the Chinese online-games provider reported second quarter total net revenues decreased 14.4% to RMB 1.13 billion from RMB 1.32 billion in the same quarter last year. Net income for the quarter rose to RMB 308.4 million from RMB 305.2 million in the prior-year quarter. Earnings per ADS increased to RMB 1.10 or $0.17 from RMB 1.08 in the year-ago quarter.

Tiffany & Co. ((TIF)), the specialty jewelry retailer said second worldwide net sales rose 2% to $887 million from the prior year. Net earnings in the quarter rose 2% to $92 million or 72 cents per diluted share from $90 million or 69 cents per share last year.