Mergers & Acquisitions
Kellogg, Not Diamond Foods, to Acquire Proctor & Gamble’s Pringles Brand
Kellogg is acquiring Proctor & Gamble’s Pringles brand after a deal with Diamond Foods fell through. Diamond Foods had been poised to acquire Pringles for $2.695 billion. However, that deal crumbled apart after Diamond Foods announced that the last two years of financial statements will need to be restated. Proctor & Gamble is the big winner here, as Kellogg is actually buying Pringles at $2.7 billion, exceeding the Diamond Foods bid by $350 million. The big takeaways from this deal are one, that sometimes it pays to be patient, and two, that corporate sellers should expect to be thoroughly investigated. Proctor & Gamble should have done more due diligence before agreeing to sell to Diamond, as it was the investigative efforts of short sellers, not P & G that unearthed the faulty accounting records. But the accounting fraud enabled P & G to back out of the deal and sell to a new seller, and at a higher price.
Apple’s Trademark Issues Have Brought iPad Sales in China to a Halt in Some Chinese Cities
Proview Shenzen, a Chinese subsidiary of Hong Kong-based Proview International Holdings, Ltd., has asserted rights over the iPad trademark in China. Proview Int’l, the parent company, was once one of the largest manufacturers of computer displays. In 2009, Apple purchased the trademark “iPad” from a Taiwan subsidiary of Proview for $55,000. Apple contends it purchased the rights to the trademark in ten different countries including China. But, in December of 2011 a Shenzen court ruled that Apple had not rightfully purchased the rights to the trademark as it was Proview Shenzen, and not the Taiwanese subsidiary that filed trademark rights to iPad in China. Apple is maintaining its position that it has worldwide rights to the trademark, and has an appeal pending. Following the December court ruling, Proview Shenzen has taken legal action to remove iPads from stores; and the sale of iPads is now banned in some Chinese cities. Proview Shenzen is also planning on taking action to ban the export and import of all iPad 3′s. Proview Shenzen is reportedly seeking $1.6 billion from Apple in exchange for the rights to the trademark in China.
Insider Trading – STOCK Act
House and Senate Pass Versions of the STOCK Act, Which Would Limit Insider Trading by Lawmakers
As we discussed in our news update two weeks ago, the main purpose of this legislation is to stop members of congress from using non-public information gained from their positions as public officers when making investments. Private citizens go to prison when they do trade on inside information, and soon members of congress may face similar provisions. Both the House and the Senate have passed versions of the STOCK Act. Now the two bodies of congress must reconcile the differences between the two bills before the president can sign the bill and make it law.
Rumors: Amazon to Purchase More Real Estate in South Lake Union Neighborhood
According to recent rumors Amazon is in negotiations with Clise Properties, which owns 12.5 acres in the Denny Triangle, to purchase a portion of that Denny Triangle real estate. The target parcel is zoned for commercial (and residential) development, including towers. At this point the details of a possible deal are not known, but Amazon’s need to expand is well-known as the company has reportedly already outgrown its new South Lake Union headquarters.