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This document is being provided for the exclusive use of MATT TREACY at WALL STREET ACCESS NEwS, ANALYSIS AND CoMMENTARY M&a Watch
Plains Traders Bet oil Well to Force New Bid
By JIM PolSon, lIezel HIll AnD TArA lACHAPelle Plains Exploration & Production Co. shareholders are anticipating positive results
from an oil well discovery, stoking bets that Freeport-McMoRan Copper & Gold Inc. will
be forced to boost its takeover bid.
Since Phoenix-based Freeport agreed to buy Houston-based Plains in December for about $50 a share in cash and stock, or $6.9 billion, drilling began at Plains' deep-water Phobos project in the Gulf of Mexico. As analysts expect the well's results in the next month, traders last week pushed shares of oil-producer Plains as much as 2.7 percent above the mining company's bid, the most since the acquisition was announced, accord- ing to data compiled by Bloomberg.
At the same time, Freeport shares have declined 24 percent as gold and copper prices tumbled, reducing the value of the deal to about $44 a share. Cowen Group Inc. says the odds of success at Phobos are better than 50 percent, and Freeport will likely improve the cash portion of its offer to boost the bid back to $50 a share to secure support from Plains Plains Trading Above Freeport Offer Price
the Plains share- holder vote or the will come first, have already filed DEAL ARBITRAGE. Page 7.
lawsuits to block the transaction.
be a life-altering find," said Steve Spread % Offer (rs) Freeport Offer Price/Share (ls) Plains Price/Share (ls) Freeport Price/Share (ls) and president of Source: Bloomberg CACX 71545865 <GO>
continued on page 2 Today's deals (includes announced and amended deals to 8:00 a.m. New York time)
acquirer
Value eV/lTM
($M) eBiTda
CPP North American business Amtrust Financial Services Inc Capespan Group Ltd Zeder Financial Services Ltd LDK Solar High-Tech Hefei Co Ltd Hefei High Tech Industrial Dev etc Artone Paper Manufacturing Co Ltd Consumer, Non-cyclical Greylock Partners, Sutter Hill Ventures et al Rawang Specialist Hospital Sdn Bhd Consumer, Non-cyclical KPJ Healthcare Bhd Consumer, Non-cyclical FMR LLC, Polaris Venture Partners et al Consumer, Non-cyclical Perseus LLC, Venture Investors LLC Kalgoorlie Mining Co Ltd Norton Gold Fields Ltd Fund: Battery Ventures IX LP This document is being provided for the exclusive use of MATT TREACY at WALL STREET ACCESS 04.17.13 www.bloombergbriefs.com Bloomberg Brief Mergers
continued from previous page Management lP. If "you were Freeport, company that was spun off from Freeport-
you'd try to do everything you could to get McMoRan Inc. 19 years ago. For that
Bloomberg Brief Mergers
this deal done before that well comes in. company, it's paying $14.75 a share in I don't think the shareholders are going to cash, in addition to giving shareholders let that happen." a stake in a royalty trust to benefit from Newsletter Ted Merz
Plains said that its 50 percent stake in future production.
212-617-2309 the Phobos project may hold the equiva- The two takeovers will expand Freeport, lent of 306 million barrels of oil. Anadarko
which got almost 80 percent of its $18 Bloomberg News Katherine Snyder
Petroleum Corp., the well operator,
billion of revenue last year from copper, 212-617-5212 controls 30 percent, while Exxon Mobil
into a global natural resources giant with Mergers Editors John E. Morris
Corp. owns the rest. Anadarko began drill-
access to oil and gas deposits onshore ing the well in December and said it would and in the U.S. Gulf of Mexico.
212-617-0628 take about 120 days to finish. Phobos well Freeport shares plunged 16 percent, the Scott Johnson results may be available by May 6, when most in four years, the day the acquisition Anadarko is scheduled to report first- offers were disclosed as shareholders +852-2977-4678 quarter earnings, Doug leggate, a Bank punished the mining company's return Reporter Will Robinson
of America Corp. analyst, wrote in an April to oil and gas. The stock is still down 24 12 note to clients. Anadarko considers the percent as prices of its two primary com- 212-617-5327 prospect "high risk," with a 1-in-4 chance modities tumbled. Freeport is scheduled Contributing Carol Chuang
of commercial success, leggate wrote.
to report earnings tomorrow.
Data Editors
212-617-3642 Plains shareholders are also waiting to Because of Freeport's falling stock price, hear when they will vote on the Freeport the value of the bid for Plains has slid Jill Lewandowsky deal. Freeport needs majority support.
to $44.10 a share. Plains shares closed 212-617-4414 Freeport will likely offer more cash to yesterday 1.6 percent higher than that level, Newsletter Nick Ferris
Plains investors to boost the value of the and the stock has traded above the value Business Manager
bid back up to $50 a share and secure a of the bid every day since March 15.
212-617-6975 vote in favor of the deal, Cowen analysts Freeport may need to increase its of- nicholas Pope and Anthony rizzuto wrote fer for Plains by about $1 billion, said 212-617-6975 in a report dated April 5.
laurence Balter, chief market strategist Reprints & Lori Husted
Keith Moore, an event-driven strategist for at oracle Investment research, equat- MKM Partners llC, estimates that more ing to a bump of about $7.75 a share. 717-505-9701 than 30 percent of Plains holders bought Plains shareholders may not want to own the stock on a bet that the Phobos results Freeport stock after the recent underper- To subscribe via the Bloomberg terminal type BRIEF will lead to a higher bid from Freeport.
formance, he said.
<GO> or on the w Freeport said Dec. 5 that it agreed to Freeport investors wouldn't react well to 2013 Bloomberg LP. All rights reserved. buy Plains for $25 in cash and 0.6531 an increased offer, given that the deal was share of Freeport for each Plains share, unpopular to begin with, said rick de los This newsletter and its contents may not be forwarded totaling about $50 a share at the time. reyes, who helps manage about $1 billion or redistributed without the prior consent of Bloom- In conjunction with the Plains takeover, at T. rowe Price Group Inc.
berg. Please contact our reprints and permissions group listed above for more information. Freeport also said the same day that it's Terminal users can subscribe to Real M&A acquiring McMoRan Exploration Co., a
alerts by entering: SALT REALMNA<GO>.
acquirer
Value eV/lTM
($M) eBiTda
TEAK Midstream LLC Atlas Pipeline Partners LP Cosmos Initia Co Ltd Daiwa House Industry Co Ltd ALI Property Partners Corp Consumer, Cyclical Daiyoshi Trust Co Ltd Daiwa House Industry Co Ltd RM williams Pty Ltd Consumer, Cyclical YTL Corp Bhd, L Capital Management SAS Consumer, Non-cyclical Sofinnova Ventures Inc, Sofinnova Partners Two gas processing plants Bain Capital Venture Ptnrs, Revolution Ventures et al This document is being provided for the exclusive use of MATT TREACY at WALL STREET ACCESS 04.17.13 www.bloombergbriefs.com Bloomberg Brief Mergers
THe Wire
Liberty Global Said to Weigh
Bid for Kabel Deutschland
MarkeT calls
John Malone's Liberty Global Inc.
is considering a takeover bid for Kabel
■ A Liberty Global Inc. bid for Kabel Deutschland Holding AG would put pres-
Deutschland Holding AG, the German
sure on Vodafone Group plc to show its hand, as a deal is essential for Voda-
cable provider that's also a takeover target fone's competitive position, Deutsche Bank AG analyst David A. Write said in a
for Vodafone Group Plc, two people
research note. A liberty-Kabel deal would bring substantial cost synergies because familiar with the matter said.
it would create a single, national cable operator, Wright said. There have been long- no decision has been made and the en- held concerns over whether such a deal would gain regulatory clearance, although glewood, Colorado-based liberty Global liberty likely feels that it has a good grasp on those issues after its recent Kabel
is aware of the antitrust issues of any deal BW purchase, he wrote.
because it already controls Germany's "A Kabel Deutschland acquisition would be completely in following with their exist- second-largest cable operator, the people ing strategy," Robin Bienenstock, an analyst at Sanford C. Bernstein, said in a
said, asking not to be identified because note. "A deal between liberty Global and Kabel Deutschland would put Vodafone the deliberations are confidential.
under more pressure, and reduce their optionality in Germany." Bert Holtkamp, a liberty Global spokes- — Sam Chambers man in Amsterdam, declined to comment, as did Insa Calsow, a Kabel Deutschland spokeswoman near Munich.
Kabel Deutschland rose as much as 8.7 percent in Frankfurt after Manager ance on europe. rTl, which already has China State Grid, AMP Said to
Magazin reported that liberty Global listings in luxembourg and Brussels, is Weigh Bids for N.Z. Utility Stake
is preparing a bid. The stock traded 4.6 seeking growth from online and on- China State Grid Corp. and AMP Ltd.
percent higher at 73.51 euros as of 12:14 demand videos and has begun producing are among companies considering buying a.m. local time. It has a market value of youTube shows through its FremantleMe- Brookfield Infrastructure Partners LP's
6.5 billion euros ($8.6 billion).
dia division.
stake in a new zealand utility, said three In 2010, liberty Global acquired Uni- — Cornelius Rahn people with knowledge of the matter.
tymedia, with operations in central and Indicative offers for the 42 percent western Germany and added south-west Daimler Raise $2.9 Bln With
stake in Powerco Ltd., the country's
operator KabelBW the following year. This second-biggest electricity and gas week, liberty Global won european Union Sale of Remaining EADS Stake
distributor by customers, are due this approval to acquire U.K. cable provider Daimler AG, the world's third-largest
month, two people said, asking not to Virgin Media Inc.
maker of luxury cars, sold its remaining be identified as the information is pri- — Aaron Kirchfeld and Cornelius Rahn stake in Airbus SAS parent European
vate. Barclays Plc is advising Brookfield
Aeronautic, Defence & Space Co. for
on the sale, which may fetch as much Bertelsmann Selling $2.1 Bln
2.2 billion euros ($2.9 billion) to focus on as nz$450 million ($381 million), the its auto business.
Shares of Broadcaster RTL
people said.
Daimler disposed of 61.1 million shares Access Capital Advisers, a Sydney-
Bertelsmann SE, europe's largest
in eADS, equal to 7.5 percent of the total, based fund manager with about $2.6 media company, is raising as much as 1.6 at 37 euros a share, the Stuttgart, Germa- billion in assets, is also considering a bid billion euros ($2.1 billion) from the sale of ny-based automaker said in a statement for Powerco, the people said. QIC Ltd., an
a stake in broadcasting unit RTL Group
today. eADS bought 16 million of the Australian investment fund, owns the rest SA to gain funds for acquisitions.
shares for 600 million euros, Daimler said.
Bertelsmann is selling 23.18 million rTl A revaluation of Daimler's stake in China State Grid, the nation's big- shares at 54 euros to 62 euros apiece, eADS will result in an estimated 2.7 gest electricity distributor, in novem- with trading to begin April 30 in Frankfurt, billion-euro non-cash operating profit ber agreed to acquire 41.1 percent of luxembourg-based rTl said today. rTl gain in the second quarter, the carmaker ElectraNet Pty Ltd., the operator of
stock rose as much as 1.1 percent to 57.92 said last month. Daimler sold another 7.5 the main power transmission network euros in Brussels. Managers of the sale percent holding in eADS for 1.66 billion in South Australia state. The company have an option to sell an additional 2.3 euros in December.
is working with Macquarie Group Ltd.
million shares. Bertelsmann, which owns eADS, europe's biggest aerospace as it considers bidding for Powerco, one about 92 percent of rTl, wants to keep at company, climbed as much as 5.7 percent person said.
least a 75 percent stake.
to 39.30 euros and was up 4.6 percent in Andrew Willis, a spokesman for Brook- Chief executive officer Ceo Thomas
Paris. The stock has gained 46 percent field Infrastructure, couldn't be reached to Rabe plans to spend as much as 3 billion
since Daimler announced the initial stake comment outside of office hours in Toronto. euros on acquisitions over three years as sale in December.
Spokesmen at AMP and Access Capital de- Bertelsmann seeks to reduce its reli- — Robert Wall and Dorothee Tschampa clined to comment. State Grid didn't respond continued on next page

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continued from previous page to faxed questions regarding a potential bid.
The Wall Street Journal reported State Grid's interest earlier, citing people it PeoPle WaTcH
didn't identify.
Powerco, based in new Plymouth, dis- ■ Wayne Kawarabayashi joined Union Square Advisors LLC as a partner in its
tributes power to about 320,000 homes new york office, according to a statement. Kawarabayashi was previously a manag- on new zealand's north Island and gas ing director of mergers and acquisitions at Barclays Plc. He was also a managing
to about 102,000 homes, according to director at Lehman Brothers Holdings Inc. until its 2008 bankruptcy. Kawara-
bayashi advised ITC Holdings Corp. on its $1.8 billion purchase of Entergy
— Brett Foley Corp.'s power-line business that was announced in 2011.
— Will Robinson Ireland Expects Start of Bord
Gais Energy Unit Sale in Weeks
Ireland's energy ministry expects Bord
ministry said in an e-mailed response to Royal Bank of Canada is advising Bord
Gais Eireann, the state-owned utility, to
questions. GDF Suez SA, France's largest
Gais on the sale, while Royal Bank of
start the sale of its energy unit, compris- utility by market value, Centrica Plc and
Scotland Group Plc is counselling on
ing retail and power generation, "in the E.ON SE may bid for the unit, the Sunday
the reorganization of the group's capital Business Post reported March 17.
structures, including 2.2 billion euros of An information memorandum on the Bord Gais energy may be valued at as debt. Barclays Plc is advising the state
business will be issued to interested much as 1.4 billion euros ($1.8 billion), the on the transaction. parties to formally begin the process, the Irish Times said in February.
— Joe Brennan FUNCTIONS FOR THE MARKET
Use MARB to display real-time merger and acquisition (M&A) arbitrage spread data. You can sort the data by
columns and market measurements and display charts and transaction details. You can also display data by
region from saved templates, or create, edit, and share custom templates.
1. Run {MARB<GO>}, select ‘Regional
Templates' and ‘2) North America'
from the dropdown menus at the
top-left of the screen.
2. Click on a target company's ticker
and select ‘6) Deal Details' from the
3. Select the ‘27) Arb' tab at the top of
the screen to see how the premium
has evolved since bid.
— Luis Guilherme Almeida, Bloomberg Application Specialist This document is being provided for the exclusive use of MATT TREACY at WALL STREET ACCESS 04.17.13 www.bloombergbriefs.com Bloomberg Brief Mergers
ValuaTioN
linnco's deal for Berry suggests That Newfield, Bill Barrett and swift are undervalued
Berry's Comps List Can Be Read as a Guide to Takeover Candidates
WAll STreeT ACCeSS A securities filing by LinnCo LLC for its
eV/2013 esT eV/ProVed
eV/2013 daily
proposed takeover of Berry Petroleum
coMPaNy Ticker crude as %
oF reserVes
ProducTioN
Co. suggests that three other indepen-
$/Boe/day (000)
dent oil and gas producers are trading at levels that do not reflect their inherent asset values. Newfield Exploration Co.,
Bill Barrett Corp., and Swift Energy
Co.each trade at earnings, reserves, and
production multiples well below what linn is paying for Berry, suggesting that they could be takeover targets. linn announced its $4.2 billion deal for Berry on Feb. 21 and expects to close the transaction by the end of this quarter. linn's S-4 filing on Mar. 22 lists eleven independent companies that Berry's
bankers at Credit Suisse Group AG
deemed comparable to Berry. That data is summarized in the accompanying Sources: LinnCo Mar. 22 S-4, Bloomberg Valuation ratios compiled prior to Feb. 21 deal announcement. table, supplemented with the percentage of each company's proved reserves base consisting of crude oil and by the compa- and Swift's reserves are more weighted Berry. At yesterday's closing price of $20.09, nies' leverage ratio. toward natural gas than the Berry, but the newfield is only selling at an eV/Proved Although natural gas prices have recov- value disparity between gas and crude reserves value of $10.24 per Boe, versus ered to $4 per MCF (thousand cubic feet) has narrowed in the past year. All three the $14 to $17.50 range Credit Suisse used from a decade low under $2 per MCF in companies' reserves are primarily sited in in its Berry valuation process.
April 2012, crude oil prices have performed north America, which is most attractive Finally, newfield is trading at an eV/ much better than natural gas prices over from a geopolitical perspective.
Daily Production level of just $43,600, the past several years. Consequently, a Moreover, the proportion of oil in the less than half the lower valuation range reserves base with a higher percentage of newfield and Swift reserve figures is not placed by Credit Suisse on the Berry crude oil will carry a higher valuation per that much lower than those for four other daily production. If newfield were valued Boe (barrel oil equivalent) than a base companies trading at higher multiples, at an eV/reserves value of $14, the that is more dependent upon natural gas. such as SM Energy Co., Laredo Petro-
shares would be worth more than $36 According to the Berry public filings, its leum Holdings Inc., Cimarex Energy
(eV would be 566 million Boe x $14 or reserves base is composed of 74 percent Co. and SandRidge Energy Inc.
$7.9 billion, less debt of $3.0 billion, for crude oil and 26 percent natural gas.
Take newfield, which is currently trad- an equity value of $4.9 billion, or $36.15 Credit Suisse settled on a range of ing in the $20 to $21 range, down from a earnings and energy-related multiples high of $76 two years ago, with a market newfield, Barrett and Swift are each it believed best reflected Berry's posi- cap of $2.8 billion and an enterprise more dependent on natural gas than tion in the independent energy produc- value of $5.8 billion. estimated ebitda for crude oil and each company carries a tion industry. The bank concluded that 2013 is $1.48 billion, according to data higher debt load relative to its eV than Berry deserved takeover-related multiple compiled by Bloomberg, giving it an en- Berry. Still, all three stocks offer signifi- ranges of 6 to 7 times 2012 ebitda; $14 terprise value of 3.9 times 2013 ebitda, cant upside potential even at the lower to $17.50 per Boe of proved reserves; down slightly from the figure in the se- end of the valuation ranges applied by and $100,000 to $120,000 per Boe of curities filing due to a drop in newfield's linn in the Berry acquisition. daily production. stock price in the past month. Tom Burnett CFA is Director of Research newfield, Barrett and Swift all trade well That is far below the 6 to 7 times 2012 at Wall Street Access. He does not below those levels. To be sure, newfield ebitda range used by Credit Suisse to value own any of the stocks mentioned here. NEW Monitor Implied Volatility of Your Favorite Shares

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deal rosTer
Moelis Helps an early client, life Technologies, Find a Buyer
Moelis & Co., the advisory firm founded
Corp. to work on a $6.4 billion takeover
merger that formed life Technologies, was by Ken Moelis in 2007, won a role advis-
of Applied Biosystems Inc. The com-
hired this time by Sigma-Aldrich Corp. to
ing one of its early clients, Life Technolo-
bined company changed its name to life bid against its larger rival Thermo Fisher, gies Corp., on its $13.6 billion sale to
Technologies once the transaction was though its takeover effort for life Technolo- Thermo Fisher Scientific Inc. this week.
completed in 2008. gies fell short, a person familiar with the less than a year after the boutique was Morgan Stanley, one of the advisers that
matter told Bloomberg news.
founded, Moelis was hired by Invitrogen
worked across from Moelis on the 2008 — Will Robinson Life Technologies Corp.
Thermo Fisher Scientific Inc.

Investment banks: Deutsche Bank AG
Investment banks: Barclays Plc
Michael Cohen, managing Parker w Paul Parker, head of global Stynes ad director and co-head of corporate finance and M&A Molson Coors co-head of Brewing Co. on global M&A its 2.65 billion head of health-care M&A managing director, for Lehman euro ($3.5 bil- lion) purc JPMorgan Chase & Co.
Doug Braunstein, managing director and tal Partner global chairman of M&A robbie Huffines, vice- Alberto realuyo, ein, who was chairman of investment banking JPMorgan's chief financial off icer until last year, worked Jeff Stute, head of north Moelis & Co.
with Unit edHealth Group America health-care Inc. on its investment banking Angeles-based Raich left Jeff raich, managing o become a found- director and head of M&A agreement ing partner of Moelis in 2007. to pay about senior vice president $4.9 billion to buy 90 per- cent of Amil Law firms:
Cravath, Swaine
Partcipacoes & Moore LLP
Law firms:
Wachtell, Lipton, Rosen
partner, corporate ines and Stute advised partner, corporate er International Inc. partner, corporate on its $4 billion agreement Jeannemarie o'Brien, partner, ecember to purchase executive comp and benefits Gambro AB from EQT Part- eric Hilfers, partner, ners AB and Investor AB. executive comp and benefits David e. redlick, Matthew Morreale, partner, corporate partner, environmental Leibowitz, co-chair of the law firm' s mergers and John D. Sigel, partner, David Kappos, partner, acquisitions practice group, commercial finance intellectual property represented Thermo Fisher Hal J. leibowitz, on its acquisition of One Christine Varney, Lambda Inc. last year for partner, corporate partner, antitrust $925 million. erika l. robinson, partner, corporate More Deal Rosters are available at {NI DEALROSTER <GO>} on the Bloomberg.
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exPecTed
ProjecTed
TargeT oFFer
size (M) coMPleTioN
aNNualized cHaNge
iN sPread MoVe*
Sprint Nextel Corp DISH Network Corp Berkshire Hathaway, 3G Blackstone, Francisco Ptnrs, Insight Venture Mgmt Michael Dell, Silver Lake Life Technologies Corp Thermo Fisher Scientific Inc Plains Exploration & Freeport-McMoRan Copper & DISH Network Corp Coventry Health Care Inc Berry Petroleum Co Copano Energy LLC Kinder Morgan Energy Gardner Denver Inc Hudson City Bancorp Inc Lufkin Industries Inc General Electric Co Alterra Capital Holdings Ltd Commonwealth REIT Corvex Mgmt, Related Fund Ameristar Casinos Inc Pinnacle Entertainment Inc McMoRan Exploration Co Freeport-McMoRan Copper & Elliott Management Corp.
Sprint Nextel Corp Kayak Software Corp priceline.com Inc wMS Industries Inc Scientific Games Corp CH Energy Group Inc Fortis Inc/Canada #N/A Invalid Security Nielsen Holdings NV Netspend Holdings Inc Total System Services Inc Source: Bloomberg MARB<GO> North American deals
*Spread moved by more than 2% of target price: ▲= up, ▼=down

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