Allergan Inc. (AGN), Citrix (CTXS) Systems Inc. and Mead Johnson Nutrition Co. (MJN) are among companies that have at least a 30 percent chance of being sold in the next 12 months, Goldman Sachs Group Inc. analysts said.
A broader group of potential takeover targets, which Goldman Sachs created in October 2009 and updates periodically, returned 51 percent since inception, compared with 19 percent for the Standard & Poor’s 500 Index, Goldman Sachs said.
“A combination of solid GDP growth, improving equity sentiment and CEO confidence bodes well for a continued pickup” in mergers and acquisitions, the analysts wrote.
Climbing corporate cash balances and unspent private-equity funds will also contribute to more mergers and acquisitions, benefiting advisory firms such as Evercore Partners Inc. (EVR) and buyout fund managers such as Blackstone Group LP (BX), Goldman Sachs said. Global M&A activity jumped 27 percent to $2.23 trillion in 2010, according to data compiled by Bloomberg.
Allergan is a specialty health-care company based in Irvine, California. Citrix, based in Fort Lauderdale, Florida, is among 14 companies Goldman Sachs had on its original October 2009 list of top takeover targets, saying that the companies had a 30 to 50 percent chance of M&A activity. All of those companies remain independent.
Lear Corp. (LEA) and AK Steel Holding Corp. (AKS) are among the top candidates for a leveraged buyout, Goldman Sachs said, based on a separate model that calculates the potential internal rate of return that a private-equity buyer could expect to realize.
Below is the list of the 33 companies that Goldman Sachs analysts said have at least a 30 percent chance of being sold in the next 12 months.
Cabot Oil & Gas Corp. GenOn Energy Inc. Sara Lee Corp. Mead Johnson Nutrition Co. BJ’s Wholesale Club Inc. Family Dollar Stores Inc. AMB Property Corp. CBL & Associates Properties ProLogis Alexion Pharmaceuticals Inc. Cepheid Edwards Lifesciences Corp. Health Net Inc. WellCare Health Plans Inc. United Therapeutics Corp. Allergan Inc. Airgas Inc. Acme Packet Inc. Amdocs Ltd. Computer Sciences Corp. ExlService Holdings Inc. Heartland Payment Systems Inc. Sapient Corp. WNS Holdings Ltd. Verigy Ltd. Akamai Technologies Inc. Citrix Systems Inc. CommVault Systems Inc. Limelight Networks Inc. Taleo Corp. Tibco Software Inc. Global Crossing Ltd. Leap Wireless International Inc.