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Monday, September 21, 2009

Comcast, Sunoco ought to be acquired: report

"M&A should start picking up now," and some of Philadelphia's biggest companies are priced to sell, say analysts at Credit Suisse.

Comcast Corp., of Philadelphia, and AmerisourceBergen Corp., Wayne, are among 25 U.S. big companies that ought to attract buyers because they enjoy such high cash flow and low debt that a "hypothetical" new owner "should be able to finance a deal" using the target companies' own money, the team of analysts led by Richard Garthwaite wrote in a report to clients last week.

UK drugmaker GlaxoSmithKline, a major local employer, is also takeover bait, by Credit Suisse's measure. So are Dell, Nike, Pepsico, Walt Disney and healthcare stocks like Amgen, Cardinal, Coventry, and Unitedhealth. Separately, Philadelphia oil refiner Sunoco and Pittsburgh-based United States Steel are among 10 industrial companies that should draw buyers, in part because their market prices are below plant "replacement value."

Credit Suisse isn't saying Comcast will sell next week, or ever. It's just looking at financial data, not at "blocking stakes" such as Comcast chief executive Brian Roberts' supersize voting power, which prevents Roberts from selling Comcast until he wants to, no matter how good a deal would be for his investors.

Why are we talking merger at all? Isn't the economy slow, aren't banks reluctant to finance deals? "The worst recession in 70 years" and deep expense cuts has left US companies "setting the stage for a surge in mergers and acquisitions" as they "pile up cash" in a time of low interest rates, writes Bloomberg News, citing the CreditSuisse report, here. Today's $3.9 billion Dell-Perot Systems deal, and Kraft's recent offer for Cadbury, also feed deal speculation. 
Posted by Joseph N. DiStefano @ 10:47 AM  Permalink | 19 comments
Comments   
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 1:24 PM, 09/21/2009
    kelprod1: That is a complete and baseless distortion of Obama's policies. He has never implied that they are evil nor that they should be regulated or taxed (etc.) into oblivion. Regulated? You bet. But not into oblivion. A little regulation (or enforcement of existing regulations) could have prevented the economic meltdown we're in right now, and which he's trying to get us out of. Take your neo-con blather elsewhere, or at least make posts based on evidence and reason.
    — Tatts
  • Comment removed.
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 2:21 PM, 09/21/2009
    Tatts, substitute Pelosi for Obama in that post and tell me where it's wrong.
    — Echo
  • 0 like this / 0 don't   •   Posted 2:23 PM, 09/21/2009
    kelprod1: Stop watching Glen Beck and Rush Limbaugh and THINK man! Nobody in Washington is trying to run PROFITABLE companies.
    — SouthJerseySteve
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 3:09 PM, 09/21/2009
    I see Comcast acquiring ABC TV for its ESPN sports network to add to its stable of sports networks. Comcast could get ABC TV to move to Philadelphia to take over cheaper office space and Philadelphia would be a media hub with ABC relocating there.
    — James
  • 0 like this / 0 don't   •   Posted 3:11 PM, 09/21/2009
    whatever happened with trustbusting? we shouldn't allow these companies to keep devouring each other until we have one giant mega corporation that controls everything and is too big to fail.
    — Ryan
  • 0 like this / 0 don't   •   Posted 3:20 PM, 09/21/2009
    This is like looking at the preseason roster of the Eagles (the known best roster in the NFL). It looks and sounds good on paper....but when you bring in reality....???
    — knight
  • 0 like this / 0 don't   •   Posted 3:26 PM, 09/21/2009
    Did anyone read Atlas Shrugged?
    — MPM JR
  • 0 like this / 0 don't   •   Posted 4:03 PM, 09/21/2009
    kelprod1 is a typical republican. They have not stopped throwing Obama under the bus and being overly critical of everything he's done. We are in this position because of the 8 years prior to him in office. He hasn't even been the president for a year yet and has to correct many of the problems he inherited.
    — Dozer
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 5:43 PM, 09/21/2009
    kelprod1 how dare you cloud up th issue with facts. Don't you read the papers? We need to spread your money around more. What do you think because you earned it you should keep it. Or that even though you took all the risks in starting these companies and that you worked hard and put in the time that you should reap the rewards because they have become successful, shame on you!!
    — onedayatatime
  • Comment removed.


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About Joseph N. DiStefano
Joseph N. DiStefano writes this blog to feed his PhillyDeals column in the Philadelphia Inquirer. Joe has been a member of Bloomberg LP’s New York Finance Team, wrote the book “Comcasted,” taught writing at St. Joseph’s University, and studied economics and history at Penn. Reach Joe at 215-854-5194 and JoeD@phillynews.com
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