Benzinga's M&A Chatter for Monday July 23, 2012

The following are the M&A deals, rumors and chatter circulating on Wall Street for Monday July 23, 2012:

Genesee & Wyoming to Acquire RailAmerica for $27.50/Share

The Deal:
Genesee & Wyoming (NYSE: GWR) and RailAmerica (NYSE: RA) jointly announced Monday that they have entered into an agreement under which GWI will acquire RailAmerica for an all cash purchase price of $27.50 per share. GWI's acquisition of RailAmerica will combine the two largest short line and regional rail operators in North America, strengthening GWI's ability to serve its industrial customers and Class I railroad partners.

GWI expects to fund the transaction and the simultaneous refinancing of its existing debt with approximately $2.0 billion of new debt and approximately $800 million of equity or equity-linked securities. GWI has received $2.3 billion of committed debt financing from BofA Merrill Lynch and $800 million of committed equity financing from The Carlyle Group of which it has agreed to take a minimum of $350 million through a private placement of two-year mandatorily convertible preferred stock from Carlyle Partners V, a $13.7 billion U.S. buyout fund. The Carlyle Convertible has a coupon of 5% per annum for two years and is mandatorily convertible at a conversion price of $58.49. GWI has the option to fund up to an additional $450 million of The Carlyle Convertible on the same terms, subject to certain conditions. Alternatively, GWI may instead choose to fund the $450

million through the public issuance of equity or equity-linked securities.

RailAmerica closed at $27.25 Monday, a gain of 9.83% on 24 times average volume.

CNOOC To Acquire Nexen For $27.50/Share

The Deal:
CNOOC Limited (NYSE: CEO) and Nexen (NYSE: NXY) announced Monday that they have entered into a definitive agreement under which CNOOC Limited will acquire all of the outstanding common shares of Nexen for $27.50 per share in cash.

The purchase price represents a premium of 61% to the closing price of Nexen's common shares on the NYSE on July 20, 2012, and a premium of 66% to Nexen's 20 trading-day volume-weighted average share price. Total cash consideration of approximately $15.1 billion will be paid for Nexen's common and preferred shares, and Nexen's current debt of approximately $4.3 billion will remain outstanding. The transaction, which will be completed by way of a plan of arrangement, is expected to close in the fourth quarter of 2012.

Nexen closed at $25.90 Monday, a gain of 51.82% on 58 times average volume.

DigitalGlobe and GeoEye Agree to Merge in $900M Deal

The Deal:
DigitalGlobe (NYSE: DGI) and GeoEye (NASDAQ: GEOY) announced Monday that the boards of directors of both companies have unanimously approved a definitive merger agreement under which the companies will combine in a stock and cash transaction valued at approximately $900 million.

Under the terms of the agreement, GeoEye shareowners will have the right to elect either 1.137 shares of DigitalGlobe common stock and $4.10 per share in cash, 100% of the consideration in cash ($20.27) or 100% of the consideration in stock (1.425 shares of DigitalGlobe common stock), for each share of GeoEye stock they own, with the amount of cash and stock subject to proration depending upon the elections of GeoEye shareholders, such that aggregate consideration mix reflects the ratio of 1.137 shares of DigitalGlobe common stock and $4.10 per share in cash. Based upon the closing prices of DigitalGlobe and GeoEye as of July 20, 2012, the transaction delivers a premium of 34% to GeoEye's July 20, 2012 closing price of $15.17 per share. Upon completion of the transaction, DigitalGlobe shareowners are expected to own approximately 64% and GeoEye shareowners are expected to own approximately 36% of the combined company.

GeoEye closed at $20.43 Monday, a gain of 5.26% on 11 times average volume.

NRG and GenOn to Merge

The Deal:
NRG Energy (NYSE: NRG) and GenOn Energy (NYSE: GEN), entered into an Agreement and Plan of Merger on Sunday. Upon the terms and subject to the conditions set forth in the Merger Agreement, which has been approved by the boards of directors of NRG and GenOn, Merger Sub will merge with and into GenOn, with GenOn continuing as the surviving corporation and a wholly owned subsidiary of NRG. The Merger is intended to qualify as a tax-free reorganization under the Internal Revenue Code of 1986, as amended, so that none of GenOn, NRG, Merger Sub or any of the GenOn stockholders generally will recognize any gain or loss in the transaction, except that GenOn stockholders will recognize gain with respect to cash received in lieu of fractional shares of NRG common stock.

Upon the closing of the Merger, each issued and outstanding share of GenOn common stock, par value $0.001 per share, other than cancelled shares, will automatically be converted into the right to receive 0.1216 shares of common stock of NRG, except that cash will be paid in lieu of fractional shares. Based on NRG's and GenOn's closing share price on July 20, the transaction represents a 20.6% premium to GenOn's stockholders. GenOn stock options (other than options granted in 2012, which are not subject to acceleration of vesting) will immediately vest and will generally convert upon completion of the Merger into stock options with respect to NRG common stock, after giving effect to the Exchange Ratio. In addition, the Merger Agreement provides that GenOn's outstanding restricted stock units (other than restricted stock units granted in 2012, which are not subject to
acceleration of vesting) will immediately vest and will be exchanged for the merger consideration.

GenOn Energy closed at $2.29 Monday, a gain of 25.82% on 18 times average volume.

Peet's Coffee to Be Acquired by Joh. A. Benckiser for $73.50/Share

The Deal:
Peet's Coffee & Tea (NASDAQ: PEET) and Joh. A. Benckiser announced Monday that they have entered into a definitive agreement under which JAB will acquire Peet's for $73.50 per share in cash, or a total of approximately $1 billion. The agreement, which has been unanimously approved by the Peet's Board of Directors, represents a premium of approximately 29% over Peet's closing stock price on July 20, 2012.

At the close of the transaction, Peet's will be privately owned and will continue to be operated by the company's current management team and employees. Peet's Coffee & Tea, founded in Berkeley, CA in 1966 by Alfred Peet, will remain based in the San Francisco Bay Area, with its home office in Emeryville and its LEED (Leadership in Energy and Environmental Design) Gold Certified roast-to-order facility in Alameda.

Peet's Coffee closed at $73.05 Monday, a gain of 27.80% on 17 times average volume.

VMware to Acquire Nicira for $1.05B

The Deal:
VMware (NYSE: VMW) announced Monday it has signed a definitive agreement to acquire Nicira, a pioneer in software-defined networking and a leader in network virtualization for open source initiatives.

VMware will acquire Nicira for approximately $1.05 billion in cash plus approximately $210 million of assumed unvested equity awards. The acquisition is subject to regulatory approvals and other customary closing conditions. The parties expect the acquisition to close during the second half of 2012. The acquisition has been approved by the boards of directors of both VMware and Nicira and the stockholders of Nicira.

VMware closed at $89.23 Monday and traded slightly lower after-hours on earnings beat, lowered guidance.