A roundup of some of the North American equities that made moves in both directions
On the rise
TC Energy Corp. (TRP-T) rose after it said on Tuesday it would acquire all outstanding shares of TC PipeLines LP (TCP-N) in a deal that values the natural gas pipelines operator at about US$1.68-billion.
TC PipeLines’ common shareholders would receive 0.70 common shares of TC Energy, which represents a 19.5-per-cent premium to TC PipeLines’ closing price as of Oct. 2, before the initial offer was made.
The deal is expected to close late in the first quarter or early in the second quarter of 2021. TC PipeLines will be wholly-owned by TC Energy and cease to be a publicly-held master limited partnership, once the deal closes.
Keystone pipeline operator TC Energy already owns a 23.96-per-cent stake in TC PipeLines, according to Refinitiv data.
Apple Inc. (AAPL-Q) gained after Nikkei reported it plans to manufacture up to 96 million iPhones in the first half of 2021, a nearly 30-per-cent year-on-year increase owing to strong demand for its 5G handsets.
It has asked suppliers to produce around 95 million to 96 million iPhones, including the latest iPhone 12 range as well as older iPhone 11 and SE models, but an industrywide shortage of key components could threaten the target, according to the report.
The company plans to build up to 230 million iPhones next year, a 20-per-cent rise from 2019, though the target will be regularly reviewed and revised in response to consumer demand, Nikkei reported.
Apple has been fighting for several years to become less dependent on the iPhone, which contributed to 40.8 per cent of overall sales during the last quarter, as new markets and demand for handsets began to peak after a decade of spectacular growth.
U.S. drugmaker Eli Lilly and Co. (LLY-N) was up after it said on Tuesday it would buy Prevail Therapeutics Inc. (PRVL-Q) in a deal valued at US$1.04-billion to expand its presence in the lucrative field of gene therapy.
Lilly said it would acquire Prevail for US$22.50 per share, which represents a premium of 80 per cent to Monday’s closing price.
Shares of Prevail, which develops gene therapies for patients with neurodegenerative diseases such as Parkinson’s disease and dementia, soared.
The deal also includes a “contingent value right” worth US$4 per share in cash, payable upon the first regulatory approval of a product from Prevail’s pipeline.
Several of Prevail’s therapies have been granted “fast track” and “orphan drug” tags by the U.S. Food and Drug Administration and the European Commission.
Lilly also said it expects 2021 sales to be between US$26.5-billion and US$28-billion, which includes revenue of about US$1-billion to US$2-billion from its COVID-19 treatments.
Analysts had expected sales of US$26.47-billion in 2021, according to IBES data from Refinitiv.
Shares of Aon PLC (AON-N) were up despite Reuters reporting its US$30-billion bid for Willis Towers Watson PLC (WLTW-Q) to create the world’s largest insurance broker faces a full-scale investigation because of its complexitY.
The companies, which are the second and third-largest brokers globally after leader Marsh & McLennan Companies Inc , are looking to the deal to boost their pricing power. Analysts said this will likely trigger deep regulatory scrutiny.
The insurance industry is facing a host of issues, with rising claims and new threats from the global outbreak of coronavirus and climate change.
The European Commission, which will open the probe following the end of its preliminary review on Dec. 21, and Aon declined to comment. A full-scale EU investigation takes about five months.
Aon did not provide concessions on Monday, the deadline for doing so in the preliminary phase to address EU competition concerns, the EU competition enforcer’s website showed.
The two companies put together insurance contracts for clients that involve a number of insurance providers, for anything from airlines to large sporting events.
On the decline
Husky Energy Inc. (HSE-T) was down after it said on Tuesday its shareholders approved the company’s merger with rival Cenovus Energy Inc. (CVE-T) to create Canada’s No. 3 oil and gas producer, as a pandemic-driven collapse in demand forces the industry to consolidate.
Husky said it got more than 99.9 per cent of common shareholder votes in favor of the merger at a special meeting.
Moderna Inc. (MRNA-Q) shares dipped as its COVID-19 vaccine appeared to be set for regulatory authorization this week after U.S. Food and Drug Administration staff members did not raise any major new concerns about it in documents released on Tuesday.
The FDA reviewers said a two-dose regimen of Moderna’s vaccine was highly effective in preventing confirmed cases of COVID-19 and did not raise any specific safety issues with using the vaccine in adults over the age of 18.
The comments were made in documents prepared for Thursday’s meeting of outside experts, who will discuss whether to endorse a U.S. emergency use authorization (EUA) for the Moderna shot.
The FDA typically follows the advice of the panel, but is not required to do so.
Moderna’s is the second vaccine the FDA has considered, behind one from Pfizer Inc. and Germany’s BioNTech , which was authorized last week.
Hospitals began giving the Pfizer shots on Monday and the United States is counting on the Moderna vaccine to fulfill its promise to inoculate 20 million people this month.
With files from staff and wires