For the record, a little postmortem from today's FTC statement on the closing of the investigation:

• The Commission has concluded that, under current market conditions, Omnicare’s acquisition of NeighborCare is not likely to result in anticompetitive effects – arising either from a unilateral exercise of market power by Omnicare, or from coordinated interaction among remaining rival IPs. In a very high percentage of the areas where Omnicare and NeighborCare both are capable of serving the same SNF – because each has a pharmacy within 100 miles – PharMerica and/or Kindred are also located within 100 miles. Most of the remaining SNFs have three or more independent IPs located within 100 miles. The vast majority of SNFs, therefore, have multiple rival IPs within their service areas.
• The investigatory record – including pricing data, customer-loss (bid) data, and scores of interviews and testimony from industry participants – suggests that independent IPs generally are effective rivals to the chain IPs in the service areas where they compete. It is not likely that Omnicare, post-acquisition, could unilaterally impose an anticompetitive increase in price or reduction in quality on SNFs. The record also contains many examples of competitive entry – by, among others, former employees of incumbent IPs that have opened rival firms; retail pharmacies that have expanded into institutional pharmacy; and SNFs, that like Kindred, have vertically integrated. Relatively easy entry conditions in the current marketplace further reduce the likelihood that incumbents, under current market conditions, could profitably sustain a course of coordinated interaction over a significant time period.

As we noted, we didn't see it as a practical 3-to-2, Kindred is an effective competitor, competition is local and the independent and smaller pharmacies constrain the LTCPA members, and entry barriers are lower than some suggested.

From Amendment #2 to the proxy, filed today:

• ASKJ meeting is July 19, 2005; record date is June 10, 2005
• This proxy statement/prospectus is dated June 16, 2005, and is first being mailed to Ask Jeeves stockholders on or about June 17, 2005.
• You will receive 1.2668 shares of IAC common stock in exchange for each share of Ask Jeeves common stock you own at the time we complete the merger.
• Under Delaware law and Ask Jeeves' certificate of incorporation, the holders of a majority of the shares of Ask Jeeves common stock outstanding as of June 10, 2005, the record date of the special meeting, must vote to adopt the merger agreement in order for the merger to be completed.
• On April 18, 2005, the applicable waiting period under the HSR Act was terminated.
• Ask Jeeves and IAC are working to complete the merger as quickly as possible. We currently expect to complete the merger in the third quarter of 2005, although we cannot assure you that all conditions to the completion of the merger will be satisfied by then.

The second half of July was the projection, and that's just what we got. This deal should be able to close after the meeting.

ADBE reports:

• In the second quarter of fiscal 2005, Adobe achieved record revenue of $496.0 million, compared to $410.1 million reported for the second quarter of fiscal 2004, and $472.9 million reported in the first quarter of fiscal 2005. On a year-over-year basis, this represents 21 percent revenue growth. Adobe's second quarter revenue target range was $475 to $495 million.
• "Adobe's performance in Q2 reflects our third consecutive quarter of record revenue, demonstrating continued execution against our strategy," said Bruce Chizen, CEO. "Our planned acquisition of Macromedia will further enhance our ability to deliver an industry-defining technology platform and enable us to offer a wider range of solutions to customers and industries around the world."
• On April 18, 2005, Adobe announced a definitive agreement to acquire Macromedia (Nasdaq:MACR). Adobe said today the integration planning process between the two companies is well underway and continues to anticipate the acquisition will close in the Fall of 2005. The Company also indicated its pre-merger notification and report form under the Hart-Scott-Rodino Act is currently being reviewed by the Department of Justice, and said it expects to file a registration statement on Form S-4 in the next few weeks.

"Currently being reviewed" indeed, and we think they'll keep on reviewing it even after the new expire date lapses. As we've said, we are thinking that, even though refilings are often good signs, it will take the DOJ more than 60 days to determine that the integrated offerings from IBM, Borland, and BEA are competitive alternatives. The call is at 5:00 today. Access it here.

Our merger agreement summary:

• Parties: dated as of June 15, 2005, among Pfizer Inc., a Delaware corporation (“Parent”), Viper Acquisition Corp., a Delaware corporation and a wholly-owned Subsidiary of Parent (“Sub”), and Vicuron Pharmaceuticals, Inc., a Delaware corporation (the “Company”).
• Consideration: Each share of Company Common Stock, including the associated right (the “Rights”) to purchase one-hundredth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share (“Series A Preferred Stock”), of the Company or in certain circumstances Company Common Stock pursuant to the Shareholders Rights Agreement dated as of June 28, 2001, as amended, by and between the Company and American Stock Transfer & Trust Company, as Rights Agent (the “Rights Agreement”), issued and outstanding immediately prior to the Effective Time (other than shares to be canceled in accordance with Section 2.1(b) of this Agreement and the Appraisal Shares (as defined in Section 2.1(d) of this Agreement) shall be converted into the right to receive $29.10 in cash (as such amount may be adjusted pursuant to Section 2.2(h)), without interest (the “Merger Consideration”).
• Conditions:
  • Shareholder approval
  • HSR
  • No injunction/restraint
• Approvals: [None other than] (i) filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended and the rules and regulations thereunder (the “HSR Act”), (ii) any filings with or receipt of approvals or expiration of the waiting periods with respect to any filings made under antitrust Laws with other Governmental Entities, (iii) the filing of the Proxy Statement with the SEC, and any other filings or notices pursuant to securities Laws and stock exchange rules in the United States and Italy, (iv) the filing of the Certificate of Merger with the Secretary of State of the State of Delaware, (v) such filings or notices as may be required under any environmental, health or safety Law (including any rules and regulations of the FDA) in connection with the Merger, and (vi) actions, consents or approvals that would not, either individually or in the aggregate, be reasonably likely to have a Company Material Adverse Effect.
• Best Efforts: Section 5.3
  • Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use commercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Merger and the other transactions contemplated by this Agreement, including using commercially reasonable efforts to accomplish the following: (i) the taking of all acts necessary to cause the conditions to Closing to be satisfied as promptly as practicable, (ii) the obtaining of all necessary actions or nonactions, waivers, consents and approvals from Governmental Entities and the making of all necessary registrations and filings (including filings with Governmental Entities) and the taking of all steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by, any Governmental Entity, including the filings set forth on Section 5.3 of the Company Disclosure Schedule, and (iii) the obtaining of all necessary consents, approvals or waivers from third parties. In connection with and without limiting the foregoing, the Company and Parent shall duly file with the U.S. Federal Trade Commission and the Antitrust Division of the Department of Justice the notification and report form (the “HSR Filing”) required under the HSR Act with respect to the transactions contemplated by this Agreement as promptly as practicable. Each party shall cooperate with the other party to the extent necessary to assist the other party in the preparation of its HSR Filing, to request early termination of the waiting period required by the HSR Act and, if requested, to promptly amend or furnish additional information thereunder. [...] Nothing in this Section 5.3 shall require Parent or any of its Subsidiaries, whether as a condition to obtaining any approval from a Governmental Entity or any other person or for any other reason, to sell, divest or otherwise dispose of, or permit the sale, divestiture or other disposition of,
    • (A) any assets of the Company or any of its Subsidiaries to the extent that the value of such assets would be material to the Company and its Subsidiaries, taken as a whole, or
    • (B) any assets of Parent or any of its Subsidiaries to the extent that the value of such assets of Parent or any of its Subsidiaries would, if owned by the Company or any of its Subsidiaries, be material to the Company and its Subsidiaries, taken as a whole.
• Material Adverse Effect:
  • “Company Material Adverse Effect” means any change, effect, event, violation, inaccuracy, circumstance, effect, occurrence, state of facts or development (any such item, other than such items disclosed in either the Disclosure Schedule or the reports, schedules, forms, statements and other documents filed by the Company with, or furnished by the Company to, the United States Securities and Exchange Commission (the “SEC”) pursuant to sections 13(a), 13(c), 14 or 15(d) of the Exchange Act from January 1, 2003 until the date of this Agreement, an “Effect”) which individually or in the aggregate when taken together with all other Effects that have occurred prior to the date of determination of the occurrence of the Company Material Adverse Change or Company Material Adverse Effect, that is or is reasonably likely to be (i) materially adverse to the business, assets, properties, results of operations or financial condition, taken as a whole, of the Company or (ii) prevent or materially impede, interfere with, hinder or delay the consummation by the Company of the Merger; provided that none of the following Effects shall be taken into account in determining whether there has been or will be a Company Material Adverse Effect or Company Material Adverse Change:
    • (A) changes affecting the United States economy or any United States or Italian securities market in general (which changes or developments, in each case, do not disproportionately affect the Company in any material respect),
    • (B) changes or developments in the pharmaceutical industries in which the Company participates (which changes or developments, in each case, do not disproportionately affect the Company in any material respect),
    • (C) changes resulting from political instability, acts of terrorism or war,
    • (D) changes resulting from or arising out of the announcement of this Agreement or actions pursuant to (and required by) this Agreement,
    • (E) any change in Company’s stock price or trading volume (it being understood that the facts or occurrences giving rise to or contributing to such change in stock price or trading volume may be taken into account in determining whether there has been or will be, a Company Material Adverse Effect or Company Material Adverse Change),
    • (F) the determination by, or the delay of a determination by, the FDA or its European equivalent, or any panel or advisory body empowered or appointed thereby, with respect to the approval, non-approval or disapproval of any of Company’s products,
    • (G) the result of any clinical trial, or
    • (H) any failure, in and of itself, by the Company to meet any internal or published projections, forecasts or revenue or earnings predictions for any period ending on or after the date of this Agreement (it being understood that the facts or occurrences giving rise to or contributing to such failure may be taken into account in determining whether there has been or will be, a Company Material Adverse Effect or Company Material Adverse Change)[.]
  • “Parent Material Adverse Effect” means any change, effect, event, occurrence, state of facts or development which individually or in the aggregate would reasonably be expected to result in any change or effect that would reasonably be expected to prevent or materially impede, interfere with, hinder or delay the consummation by Parent or Sub of the transactions contemplated hereby[.]
• Termination:
  • Walk date is nine month anniversary of the agreement
  • $58 million break-up fee
• Closing: later than the second Business Day (as defined below) after satisfaction or (to the extent permitted by this Agreement and applicable Law) waiver of the conditions set forth in Article VI of this Agreement (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or (to the extent permitted by this Agreement and applicable Law) waiver of those conditions),[...] unless another time, date or place is agreed to in writing by Parent and the Company; provided, however, that if all the conditions set forth in Article VI of this Agreement shall not have been satisfied or (to the extent permitted by this Agreement and applicable Law) waived on such second Business Day, then the Closing shall take place on the first Business Day on which all such conditions shall have been satisfied or (to the extent permitted by this Agreement and applicable Law) waived.

A no divestitures clause with a materiality standard. We don't see it making coming into play in this deal anyway. Nine months would be next March 15.

As we noted, the MICU 10-K lists the following competitors:

Bristol-Myers Squibb Co., Schering-Plough Corp., Aventis S.A., Fujisawa Pharmaceutical Co. Limited, Johnson & Johnson Inc., Pfizer Inc., Merck & Co. Inc., Cubist Pharmaceuticals Inc., Enzon, Gilead Sciences Inc., InterMune, Wyeth and Theravance.

We have broken the competitors down by product, based upon our research:

• Dalbavancin - MICU
• Zyvox - PFE
• Synercid - Aventis S.A. (dalfopristin / quinupristin)
• Cubicin - Cubist (daptomycin)
• Ceftobiprole - Johnson & Johnson
• Televancin - Theravance
• Tigecycline -Wyeth

• Anidulafungin - MICU - echinocandins
• Diflucan - PFE - fluconazole
• Vfend - PFE - voriconazole
• Cancidas - Merck - echinocandins - caspofungin acetate
• Mycamine - Astellas Pharma Inc.(formerly Fujisawa) - echinocandins - micafungin sodium
• Sporanox - Johnson & Johnson Inc., - itraconazole
• AmBisome - Astellas Pharma Inc.(formerly Fujisawa) - liposomal amphotericin B
• Abelcet - Enzon Pharmaceutical - liposomal amphotericin B

There is overlap, but, in each case there are other products on the market, and in the case of Dalbavancin, a number of other products in development including Dalbavancin itself. We'll look at the remaining competitors mentioned: Bristol-Myers Squibb Co., Schering-Plough Corp., Gilead Sciences Inc., and InterMune to see exactly how they compete, but it looks like each product faces a number of existing competitors. The merger agreement has been filed and we'll have our summary posted shortly.

PFE's Zyvox is for the treatment of resistant infections. Aventis' Synercid (dalfopristin / quinupristin) also competes with PFE's Zyvox, as does Cubist's recently approved Cubicin (daptomycin). In addition, Wyeth's tigecycline was recently granted priority review status.

From an April 22, 2005, Datamonitor report:

• The FDA's decision to grant Wyeth's tigecycline priority review status is a welcome one. Wyeth recently presented data on tigecycline, the first drug in a novel class of antibiotics, which showed that the drug demonstrated efficacy against a wide variety of bacterial infections, including MRSA. Tigecycline's entry onto the market would be timely, as global concern mounts over such 'superbugs'.
• Although there are several antibacterials available for the treatment of resistant infections, such as Pfizer's Zyvox (linezolid), King Pharmaceutical's Synercid (dalfopristin / quinupristin) and Cubist's recently approved Cubicin (daptomycin), there is still a need for new drugs. Tolerability issues, for example, prevent the prolonged use of Zyvox, which runs the risk of the development of myelosuppression. Furthermore, Synercid is only available in injectable formulation, preventing its use outside of the hospital. Moreover, these drugs are not active against all strains of resistant bacteria.

From the Cubist 10-K:

CUBICIN is currently approved in the U.S. for the treatment of cSSSI caused by certain Gram-positive organisms. There are many currently approved antibiotics used to treat these types of infections. The most commonly prescribed antibiotics for susceptible strains of bacteria are: first-generation cephalosporins, such as cefazolin, and semi-synthetic penicillins, such as oxacillin and nafcillin. For the treatment of resistant organisms, the most commonly prescribed treatments are vancomycin and linezolid. All of these antibiotics, except linezolid, which is marketed as Zyvox, are distributed by generic manufacturers at low cost. In addition, there are drug candidates in development, examples of which are Ceftobiprole (being developed by Basilea Pharmaceutica and Johnson & Johnson) , Dalbavancin (Vicuron), Televancin (Theravance with GlaxoSmithKline ) and Tigecycline (Wyeth), which, if approved, would compete in the IV antibiotic market.

Ceftobiprole is in phase III clinical trials in complicated skin and skin structure infections and hospital-acquired pneumonia trials are in preparation. Telavancin is currently in Phase 3 clinical studies designed to demonstrate non-inferiority of telavancin compared to vancomycin for the treatment of serious Gram-positive infections and superiority over vancomycin in those patients whose infections are due to MRSA in both cSSSI and hospital-acquired pneumonia. Depsite the apparent overlap, we believe with Aventis, and Cubist having products on the market, and Johnson & Johnson, GlaxoSmithKline, and Wyeth all in phase III clinical trials, we don't see an antitrust issue with the apparent overlap. In addition, from what we've seen Ranbaxy Laboratories Ltd., Dong-A Pharmaceutical Co, and AstraZeneca plc, which says it has novel oxazolidinone (AZD2563) in development, are also doing research on the next generation of Oxazolidinones.

As we've noted, IDTI is relatively new entrant to timing.

ICST's more traditional competitors have been Cypress Semiconductor, Texas Instruements, and Motorola.

Cypress Semiconductor Corp., a world leader in timing technology solutions, today announced sample availability of a unique two-device solution that fully addresses timing and electromagnetic interference (EMI) reduction requirements of notebook PCs. Intel has qualified Cypress’s frequency timing generator (CY28411) and Peak Reducing EMI Solutions (Premis™) spread spectrum clock generator (CY25823) as meeting its CK410m and CK-SSCD specifications and definitions for its low-power Alviso platform for notebook PCs.

We should note that in December of last year, Analog Devices entered the market.

ADI's acknowledged competitors include Integrated Circuit Systems (which has an extremely large footprint here), as well as Cypress Semiconductor and IDT.

We've also seen product offerings for Clock generator ICs from Pericom Semiconductor and Freescale Semiconductor. As we've noted, every electronic device out there--virtually every one--needs a timing device. These are component products and the products into which they are incorporated are themselves intensely competitive. With the commodity-like pricing of the products, the number of other competitors mentioned--some with some pretty big names--and the customers (which included Cisco, Dell, Hewlett-Packard, IBM, Intel, Lucent and Microsoft) we don't think there's an antitrust issue here despite the overlap.

AVID announced late yesterday a conference call scheduled for Monday, June 20, 2005, at 8:30 a.m. EDT, to provide an update on the financial aspects of the PCLE acquisition.

• The dial-in number is: 719.457.2653
• The replay number is: 719.457.0820
• The confirmation code and replay passcode are: 5247722
• The call will also be available via live audio webcast and subsequent replay on the company's Web site. To listen via this alternative, please visit www.avid.com/company and click on "investor relations."

The reason for the call is probably, in some part, to try and alleviate concerns over the deal amongst the AVID shareholder base. For the record, the Deal.com also speculates today on the indentity of the mystery bidder or bidders. We're not going to try and guess who's who, but we'll note the following from the proxy:

• Company A - a potential acquiror that first acquired about the acquisition of Pinnacle by Company A in May of 2004.
• Company B - contacted Pinnacle indicating an interest in purchasing selected Broadcast & Professional division assets of Pinnacle.
• Company C - a private equity firm, which contemplated a combination of Pinnacle with a portfolio software company, which is a business partner of Pinnacle, owned by Company C. Company C had engaged in discussions with a large strategic partner very familiar with Pinnacle that had expressed an interest in an immediate purchase of a portion of Pinnacle's business.
• Company D- in a letter dated May 6, 2005, Company C stated that it was partnering with an established technology buyout fund, referred to in this joint proxy statement/prospectus as Company D, and Company D co-signed the letter to Pinnacle.

However, if company C were Vector Capital, its offer of $7 is no longer on the table, so its interest would appear to have cooled. We'll see if AVID has anything to say about the events subsequent to its announcement of the deal but we doubt it.

ICS is focused on silicone timing devices.

• Silicon timing devices are silicon based circuits that emit timing signals or pulses required to sequence and synchronize electronic operations to ensure that information is interpreted at the right time and speed. All electronic devices require a timing signal and those with any degree of complexity require silicon timing devices to time and synchronize their various operations.
• Silicon timing devices are used in a variety of consumer and business electronics such as personal computers or PCs, digital cameras, set-top boxes, PC peripherals and games consoles. ICS’s products are also increasingly being used in various communications applications including routers, switches, fiber optics, line cards and ADSL equipment.

And it seems to have a pretty good share of the market:

• ICS enjoys over a 70% share of the PC and notebook motherboard market, which continues to grow. In the rapidly growing digital consumer and communications infrastructure markets, ICS is continuing to expand its presence. At present the company has approximately 30% share of the overall silicon timing market.
• ICS’s presence on leading electronics companies’ reference boards is not only an invaluable validation of the company’s products, but also contributes directly to the company’s sales. Intel, Texas Instruments, Broadcom, Divicom, NVIDIA, and Vitesse have used ICS clock chips in their reference boards in all three of ICS’s target markets.

IDT offers silicon timing devices as well:

• IDT is a leading provider of timing solutions for communication, storage, industrial and digital consumer applications. The IDT portfolio of silicon timing devices offers differentiated solution elements, such as programmable platform, precision technology, advanced I/O and stratum-compliant synchronization. Specific families include devices for clock generation, programmable skew, zero delay and non-PLL based clock fanout.
• IDT is a leading provider of timing solutions, offering a broad range of silicon timing devices that focus on clock generation and distribution. The company is uniquely positioned to offer differentiated solution elements, such as a programmable platform, precision technology, advanced I/O, and stratum-compliant synchronization. IDT offers an extensive portfolio of timing devices, including devices for clock generation, programmable skew, zero delay, and non-PLL based clock fan out devices that are targeted at applications within communications, storage, digital consumer and industrial markets.

But, is "silicon timing" the market? One commentator doesn't think so:

Silicon timing devices represent a rapidly growing portion of the total market for frequency-control/timing devices, according to forecasts by technology research firm ABI Research (Oyster Bay, NY). Such devices represent a cost-effective and reliable alternative to quartz crystal oscillators and resonators and are having a major impact on the market for quartz crystals and oscillators. Quartz crystal oscillators have suffered a steep decline in sales due to the weakening of telecommunications markets in recent years. And, although silicon-based technology is replacing quartz-based timing products in many applications, the research firm projects future growth for quartz oscillators in some niche markets, including in wireless base stations, Global Positioning Systems (GPS), space-based systems, and military applications.

"Moderate growth will return to the market by 2005." He adds, "A portion of this new growth will be derived from new product solutions, such as silicon timing."

The consequences for manufacturers of traditional oscillators are clear. "The crystal business is not going to go away," says Marino, "because in many case you still need the crystal reference. However the VCXOs and TCXOs, and to a degree the XOs, are growing at slower rates." The study forecasts that over the next five years, silicon timing device markets will grow at double, or more than double, the rate of the traditional oscillator markets.

On the call, IDT management started out by saying that, while it had increased its presence in PC and motherboard timing solutions, ICS was still worth doing, essentially. It also spoke early on about the market being "dominated by crystal solutions today" [as opposed to silicon]. The terms "next-generation" and "evolving technology" were used generously, as was the concept of "accelerating the displacement of crystal." In fact, management said that the big move towards bringing the manufacture of ICS' products in-house at IDT (ICS being fabless, i.e., it outsources everything) was really just focused on the next-generation products, not the current ones. So, you might say that a big part of the strategy of this deal is keyed to products that don't yet exist.

There was a question on head-to-head competition, and the answer was that each company has been around for 20 years and they have competed in a few areas: communications, PC, and Dual In-Line Memory Modules (DIMM). But they said that they were in different market segments. They acknowledged overlap in the PC and DIMM spaces but characterized it as "very limited" because IDT's entry in these markets was relatively recent. One caller noted that on recent IDT calls, management had said that it was taking share from ICS in clocks, asking "why buy them out?" The answer was that this deal accelerated the process; IDT entered the market a year ago and this was a better plan than taking it slow. A clear implication there, speed strategy aside, is that IDT thought it was a better idea to buy ICS than compete with it. ICS answered a question about the combined market share in clocks by saying that IDT has timing products, but only as a part of rounding out its entire product portfolio, whereas ICS has focused only on timing, so combined market shares may be misleading.

"Early October time frame" is what they said as far as timing, and that squares with the industry average for these deals. We think the size of the customers is highly relevant, and the commodity-like pricing of the products is too (yes, you have to buy 10,000, but they're three bucks each). Every electronic device out there--virtually every one--needs a timing device and by all accounts, the relatively low-tech status-quo crystal solution is still embraced by the market on a significant level.

There was a question on HSR, and the answer was that, considering silicon and non-silicon solutions, the combined company would have less than 10% of the timing market. We're not sure that silicon and non-silicon are necessarily in the same market given the "accelerating the displacement of crystal" language, but it is arguable that the market is currently broader than just silicon. The next generation silicon solution might be the rationale for the deal (as well as bring manufacturing in-house), but we think the effort will face competition from the big players not only in that regard, but also from the "older" products. Another caller asked whether, since the deal is taking out a competitor, whether pricing is going to be easier down the road. The answer was that they expect competition will remain robust and pricing will not change significantly. ICS said:

I can name four primary competitors right now in this space and there are enough other players out there such that the market would not support anything but competitive pricing.

IDT said that, with the recent entry, its position was #3 or #4 in revenues, but acknowledged that it might be already approved for certain sockets on motherboards that ICS was approved for, a caller implying that IDT may be able to force ICS customers to adopt the corresponding IDT timing product. Management said it was a fair question, but didn't quite sign on to the theory the caller was advancing. We don't think there's going to be an antitrust issue here with the customers and the competitors mentioned in the ICST 10-K. We would have greater concern if the established firm were one the taking out the new entrant--e.g., CREO/EK--but in this case, it's the new entrant in timing taking out the established firm. In other words, you don't have the same maverick firm analysis or concern. It's not like ICS was taking market share from IDT. If IDT were acting as the maverick in the market, it would essentially be shooting itself in the foot by acquiring ICS. As the one caller noted, on recent IDT calls management had said that it was taking share from ICS in clocks, asking "why buy them out?" It may have figured out that it can't compete long term, but we don't think that's the case, and if that were, it would just demonstrate how competitive the market must be.

For the record, the only thing ENTG said on it's earnings call this morning was that it was moving quickly to close the transaction and expected to finalize the merger during the third calendar quarter.

There were no questions. As we've been saying, with the preliminary proxy going in on May 9, 2005, we don't see any reason why we shouldn't see shareholder meetings and closing early in third quarter.

In response to OCR's revised bid, NCRX says it will review the offer.

John J. Arlotta, NeighborCare's Chairman, President, and Chief Executive Officer, said: "Our Board will continue to do what it believes is right for the Company, its shareholders and all other constituents. I have been saying all along that if there were a different price on the table, we'd review it carefully as is consistent with our fiduciary duties, which we are now going to do."

Given that it's trading above $32.00, the market seems to think that OCR may need to go higher.

A little discussion of Anidulafungin and Dalbavancin. For the record, the 10-K notes that MICU also has two other products in the pipeline: ramoplanin, an oral non-absorbable form of antibiotic called a lipopeptide; and VIC-Acne, a novel antibiotic which they are developing as a topical cream.

Anidulafungin belongs to a new class of antifungals called echinocandins. Anidulafungin has potent activity against the principal yeasts, such as Candida, and molds, such as Aspergillus, that cause serious fungal infections.They work by an entirely different mechanism than other two currently available classes (triazoles and amphotericins) of anti-fungal agents. The echinocandins have the advantage of being cidal while not having the serious toxicities of the amphotericins. The real advantage of the echinocandins is that they can more easily treat resistant organisms. In echinocandins, there is Merck with Cancidas, and Astellas Pharma with Mycamine.

From an article, following the announcement of the launch of Mycamine in March of this year.

• The echinocandins are a new class of antifungal agent with a distinct fungicidal mechanism of action. They act by inhibiting glucan, which, in turn, interferes with the synthesis of chitin, an important cell-wall component, and results in fungal cell lysis. The echinocandins, as a class, lack mechanism-based toxicity and have an extended spectrum of antifungal activity without evidence of cross-resistance to existing antifungals.
• A second issue for both the echinocandins and other, new antifungal agents such as Pfizer's Vfend (voriconazole), is the higher price point these drugs command. The antifungal of first choice, fluconazole (Pfizer's Diflucan), lost patent protection in 2004 and there are now several generic versions of the drug available. However, while physicians are inclined to prescribe the cheaper fluconazole in initial therapy, cost tends to be disregarded following treatment failure, as second-line therapy is usually life-saving.
• Similar to Cancidas, Mycamine is only available in an IV formulation and is likely to be priced at a premium to the older antifungals such as Diflucan and J&J's Sporanox (itraconazole). Consequently, it could be a challenge for Fujisawa to successful position Mycamine in the US, with orally available Vfend and the liposomal amphotericin B products, such as AmBisome (Astellas Pharma Inc.) and Abelcet, (Enzon Pharmaceuticals)being well-established in antifungal therapy.

Vfend from Pfizer is in a different class of drug (voriconazole). With no apparent overlap in echinocandins, with Merck and Astellas having echinocandins on the market, and with the other antifungals, we don't see an antitrust issue with here anidulafungin.

On its partnership with Pfizer, MICU notes the following in its 10-K:

• Our second most advanced collaboration is with Pfizer Inc. and is aimed at discovering second and third generation oxazolidinones. The oxazolidinones represent one of the first new major classes of antibacterial products to enter the market in over 30 years. In test tubes, our collaboration compounds are active against a broad range of bacteria, including multi-drug resistant Staphylococci, Streptococci and Enterococci. Pfizer received approval from the FDA, independent of us, for the first generation oxazolidinone called Zyvox™. We have identified several structurally novel second generation oxazolidinone candidates, certain of which have either a broader spectrum of activity or improved potency as compared to Zyvox™.

We'll take a look at oxazolidinones and the other products but we don't expect there to be an antitrust issue here.

ENTG reported this morning net income of $7.1 million, or 9 cents per diluted share, compared to $4.5 million, or 6 cents per diluted share, for the fiscal 2005 second quarter.

From the release:

On March 21, 2005, Entegris announced a definitive agreement to combine with Mykrolis in a merger of equals transaction. The company has received early termination of the waiting period under the Hart-Scott-Rodino Act and is working through the process to have its S-4 Registration Statement declared effective by the SEC. The company anticipates finalizing the merger during the 2005 third calendar quarter.

We'll see if ENTG elaborates any further on the review process on its call this morning but as we've said, with the preliminary proxy going in on May 9, 2005, we don't see any reason why we shouldn't see shareholder meetings and closing early in third quarter.

Investors have the opportunity to listen to Entegris' third-quarter conference call today at 8:30 a.m. ET over the Internet at www.entegris.com or by dialing (877) 502-9272, conference code 4573442. For those who cannot listen to the live event, a replay will be available shortly after the call on the Entegris Web site or by dialing (888) 203-1112, conference code 4573442.

A new chip deal:

• Integrated Device Technology, Inc. ("IDT")(Nasdaq:IDTI) and Integrated Circuit Systems, Inc. ("ICS")(Nasdaq:ICST) today announced the signing of a definitive agreement to combine the two companies in a strategic merger. The parties believe that the merger will allow the combined company to increase its ability to service the requirements of its customers and will provide a platform for growth within the communications, computing, and consumer markets.
• Under the terms of the merger agreement, which has been unanimously approved by the boards of directors of both companies, ICS stockholders will receive 1.300 shares of IDT common stock and $7.25 of cash for each share of ICS stock. Based on closing prices as of June 15, 2005, this total consideration values ICS at approximately $1.7 billion or $23.54 per share.
• "IDT has established a solid reputation for developing vital semiconductor solutions targeting various communications infrastructure applications, including wireline, wireless and enterprise," said Greg Lang, IDT president and chief executive officer. "Likewise, ICS has excelled in providing timing technology to consumer, PC and DIMM customers. We believe that the merger will enable customers to benefit from a stronger company with a diverse product portfolio and enhanced resources. The merged company will have an outstanding base of technology, customers and talent to pursue growth opportunities in communications, computing, and consumer market segments. Combining our resources will allow us to pursue these opportunities more effectively than we could as separate entities."
• "Combining IDT with ICS will allow us to complement our strength in timing devices for consumer and computing customers with IDT's leadership in a wide range of communications products," said Hock Tan, president and chief executive officer of ICS. "IDT's track record of solutions support and its position and technology in the communications market, are a good complement to our timing and circuit expertise. I am confident that the merged company will deliver superior solutions to our customers and value for our stockholders than either company could independently."
• Based on the most recent capitalization, current IDT stockholders will own approximately 54 percent and current ICS stockholders will own approximately 46 percent of the combined company. The transaction is subject to customary closing conditions, including shareholder and regulatory approvals, and is expected to be completed in the fall of 2005. IDT and ICS directors and executive officers have entered into voting agreements pursuant to which they have agreed to vote their shares in favor of the transaction.

Call is at 9:00 am ET:

• The IDT and ICS merger conference call will take place on June 16, 2005, at 9:00 a.m. EDT. To listen to the conference call via telephone, please call 888-423-3281 (domestic) or 612-332-0802 (international). To listen via the Internet, please visit www.IDT.com. Playback of the conference call will be available June 16, 9:30 AM PDT, and ends on June 23, 2005 at midnite, by calling 800-475-6701 domestically, or 320-365-3844 internationally; use access code: 786166.

From ICST's 10-K:

• In general, the semiconductor and PC component industries are intensely competitive and characterized by rapid technological changes, price erosion, cyclical shortages of materials and variations in manufacturing yields and efficiencies. Our ability to compete in this dynamic and opportunistic environment depends on factors both within and outside our control, including new product introduction, product quality, product performance and price, cost-effective manufacturing, general economic conditions, the performance of competition and the growth and evolution of the industry in general. There are several substantial entities in the industry who are much larger than us and who could, and do, exert significant influence in determining the pace and key trends in the development of PCs and PC components. Moreover, some of our current and potential competitors have significantly greater financial, technical, manufacturing and marketing resources. Competitors also include privately owned and emerging companies attempting to secure a share of the market for our products.

From IDTI's:

• Our communications and timing products compete with similar products offered by such companies as Cypress Semiconductor (Cypress), PMC-Sierra (PMC), Toshiba, NEC, Texas Instruments, Pericom Semiconductor, Infineon Technologies, NetLogic, Legerity, Agere Systems, Zarlink Semiconductor, Exar, Intel, Motorola, Integrated Circuit Systems, PLX Technology (PLX), and Maxim Integrated Products.

We'll dig up the market shares, but we have sense that this deal represents two companies getting together to move a little further up a big list of companies, but still lagging behind the "several substantial entities" that keep the chip deals from running into trouble. Recently we have seen some chip deals get antitrust attention where we don't think they should have, and we'll take a look at the products to see if there is some niche overlap in timing technology that could raise eyebrows, but generally, we expect this deal to go the way of 'normal' chip deals and not significantly affect competition in these fragmented markets. The Fall starts in late September, and we think that the late third quarter is possible here, or perhaps the early fourth (our chip deal average for mergers without second requests is 113 days, which would put this one on October 7, 2005).

Done deal.

From the 8-K, filing:

Pursuant to the Agreement and Plan of Merger dated as of January 17, 2005, among LMI, UGC, Liberty Global and two subsidiaries of Liberty Global (the “Merger Agreement”), the Transaction contemplated thereby was closed on June 15, 2005. As a result of the Transaction, Liberty Global became the new parent company of LMI and UGC. In the Transaction, each outstanding share of LMI common stock was converted into one share of the corresponding series of common stock of Liberty Global, and each outstanding share of UGC common stock (other than shares owned by LMI or its subsidiaries) was converted into the right to receive, at the option of the holder, (1) 0.2155 of a share of Liberty Global Series A common stock, plus cash in lieu of fractional shares, or (2) $9.58 in cash, subject to proration. The Merger Agreement provides for a limit on the aggregate number of shares of UGC common stock which can be converted into cash in the Transaction. This limit, which is referred to in the Merger Agreement as the UGC Share Threshold Number, was determined to be approximately 72.5 million shares of UGC common stock. As a result, the total amount of cash available to be paid to former UGC stockholders in payment of their cash elections is approximately $694.5 million. Based on preliminary information received from the exchange agent, the number of shares as to which cash elections have been made exceeds the UGC Share Threshold Number and, accordingly, the cash elections will be prorated in accordance with the merger agreement. The proration factor will not be available until the exchange agent determines the final number of shares of UGC common stock as to which valid cash elections were made.

The companies issued a release late yesterday confirming, as we reported earlier, that the HSR waiting period expired on June 13, 2005.

A special meeting of Corixa stockholders to consider the adoption of the merger agreement will be held on July 12, 2005, at 1:00 p.m., local time, at Corixa's corporate headquarters. Corixa and GSK expect to complete the transaction as quickly as possible after the special meeting and after all the conditions to the transaction are satisfied or waived.

The merger agreement provides for the closing to take as promptly as practicable but in no event later than the second Business Day after the satisfaction or waiver of the conditions. Assuming shareholder approval, we expect the transaction to be completed promptly after the July 12, 2005, shareholder meeting. As to MPM announcement yesterday, CRXA spokesperson is quoted as saying that they intend to respond directly to the investor and address his issues.

At last, HSR is done:

• Omnicare, Inc. (NYSE: OCR) today announced that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR) has expired, indicating that federal regulators will not object to Omnicare's proposed acquisition of NeighborCare, Inc. (NASDAQ: NCRX) and removing a major condition to the offer.

And OCR raises the offer:

• Omnicare, Inc. (NYSE:OCR) today announced that it will increase its tender offer to purchase all of the outstanding common stock of NeighborCare, Inc. (NASDAQ:NCRX) to $32.00 per share in cash for a total transaction value of approximately $1.7 billion, which includes the assumption of NeighborCare's net debt. The revised tender offer is scheduled to expire at 5:00 p.m., New York City time, on June 30, 2005, unless extended.
• Omnicare noted that its Board fully supports this increased offer and that no further corporate action on the part of Omnicare is required to consummate the proposed transaction. In addition, Omnicare has commitments for financing that are sufficient to consummate the transaction.

OCR closes the letter with:

We and our advisors are prepared to meet with you and your advisors immediately to negotiate the terms of a definitive agreement. I look forward to hearing from you soon.

End of an era. We'll see what NCRX has to say.

A new buy for Pfizer:

• Pfizer Inc. (NYSE: PFE) and Vicuron Pharmaceuticals, Inc. (Nasdaq: MICU, Nuovo Mercato) today announced that they have entered into a definitive merger agreement whereby Pfizer will acquire Vicuron, a biopharmaceutical company focused on the development of novel anti-infectives for both hospital-based and community-acquired infections.
• Under the merger agreement, Pfizer will acquire all outstanding shares of Vicuron common stock at a price of $29.10 per share in cash, for an aggregate equity purchase price of approximately $1.9 billion. This price represents a 74 percent premium over Vicuron's 90 day average closing share price and a 21 percent premium over Vicuron's highest historical closing price of $24.10 on January 16, 2004.
• Vicuron has two products currently under New Drug Application (NDA) review at the U.S. Food and Drug Administration (FDA): anidulafungin for fungal infections and dalbavancin for Gram-positive infections. Recently, Vicuron announced positive Phase III results on anidulafungin, demonstrating superiority versus fluconazole in invasive candidiasis/candidemia. Anidulafungin's potential product profile will include broad spectrum activity against aspergillus and most candidal fungal infections. It is anticipated the product will be indicated for once-daily dosing for up to a month.
• Dalbavancin has shown positive results in Phase III studies in complicated skin and soft tissue infections and in a Phase II study in catheter-related bloodstream infections. The product has once-weekly dosing. Vicuron recently announced it has received a three-month extension to the priority review for the dalbavancin NDA. The FDA review is expected to be completed on or before September 21, 2005.
• Pfizer revolutionized antifungal treatments in 1992 with the launch of Diflucan followed by the launch of Vfend, another important antifungal, in 2002. Pfizer believes anidulafungin will represent yet another significant advance in the treatment of serious fungal infections. This product candidate will be highly complementary to Vfend and will offer the health care provider with a range of products to more effectively treat patients faced with fungal infection.
• Pfizer already has an existing collaboration with Vicuron that has made significant advances in the discovery of potential next-generation oxazolidinones, the first new class of antibiotics in more than 30 years. These orally-active antibiotics are targeting to have improved potency and a broader spectrum of activity than existing classes of compounds. Several Vicuron compounds are currently being evaluated at Pfizer as potential clinical development candidates.
• Completion of this transaction is subject to regulatory approval, Vicuron shareholder's approval and other customary closing conditions. The acquisition is expected to close during the third quarter of the year.

From MICU's 10-K:

• We believe our products will face intense competition from both existing therapies and new generations of antibiotics and antifungals. We expect to compete against existing therapies on the basis of greater potency, improved effectiveness and/or reduced toxicity. Several pharmaceutical and biotechnology companies are actively engaged in research and development related to new generations of antibiotic and antifungal products. We cannot predict the basis upon which we will compete with new products marketed by others. Many of our competitors have substantially greater financial, operational, sales and marketing, and research and development resources than we have. Companies that market or are known to us to be in active development and/or commercialization of antibiotic or antifungal products in our target markets include Bristol-Myers Squibb Co., Schering-Plough Corp., Aventis S.A., Fujisawa Pharmaceutical Co. Limited, Johnson & Johnson Inc., Pfizer Inc., Merck & Co. Inc., Cubist Pharmaceuticals Inc., Enzon, Gilead Sciences Inc., InterMune, Wyeth and Theravance.

The market is antifungals/anti-infectives and the overlap is with Diflucan, but we doubt there is a competition issue here with the other players on the list being a who's who of pharmaceutical reserach and development. It's a pretty expensive grab of two products under NDAs, but the relatively low-tech antibiotic market has broad appeal and application. We'll take a look at the market to make sure there are alternatives, but we think this deal will be proxy-controlled, and the third quarter should not be a problem.

From an amendment to the S-4, filed today:

• A special meeting of Hibernia shareholders will be held on August 3, 2005.
• Only holders of record of Hibernia common shares at the close of business on June 6, 2005 are entitled to notice of, and to vote at, the special meeting or any adjournments or postponements of the special meeting.
• This document is dated June [ ], 2005, and is being first mailed to Hibernia shareholders on or about June [ ], 2005.
• Subject to the election and adjustment procedures described in this document, Hibernia shareholders will receive, in exchange for each share of Hibernia common stock they hold, consideration with a value equal to the sum of (1) 0.2261 multiplied by the average of the closing prices on the NYSE for Capital One common stock during the five trading days ending the day before the completion of the merger and (2) $15.35.
• The aggregate amount of cash that Capital One has agreed to pay to all Hibernia shareholders in the merger is fixed at $2,382,141,311 and as a result, even if you make a cash election, you may nevertheless receive a mix of cash and stock.
• The election deadline will be 5:00 p.m., local time in the city in which the principal office of the exchange agent is located, on the later of (1) the date of the special meeting of Hibernia shareholders and (2) the earlier of (A) the date that Capital One and Hibernia agree is as near as practicable to five business days prior to the expected closing date and (B) September 2, 2005. However, if it appears that the closing date will not take place prior to or on October 15, 2005, Capital One and Hibernia will discuss in good faith whether a September 2, 2005 election deadline should be deferred to an appropriate later date. Capital One and Hibernia will issue a press release announcing the date of the election deadline not more than 15 business days before, and at least five business days prior to, the election deadline.
• Approval of the merger agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Hibernia common stock.
• Our respective obligations to complete the merger are subject to the fulfillment or waiver of mutual conditions, including:
  • the approval of the merger agreement by the Hibernia shareholders;
  • the approval of the listing of Capital One common stock to be issued in the merger on the NYSE, subject to official notice of issuance;
  • the effectiveness of the registration statement with respect to the Capital One common stock to be issued in the merger under the Securities Act and the absence of any stop order or proceedings initiated or threatened by the SEC for that purpose; and
  • the absence of any statute, regulation, rule, decree, injunction or other order in effect by any court or other governmental entity that prohibits completion of the transactions contemplated by the merger agreement.
• Each of Capital One’s and Hibernia’s obligations to complete the merger is also separately subject to the satisfaction or waiver of a number of conditions including:
  • the receipt by the party of a legal opinion from its counsel with respect to certain federal income tax consequences of the merger;
  • the receipt and effectiveness of all regulatory approvals, registrations and consents, and the expiration of all waiting periods required to complete the merger; and
  • the other company’s representations and warranties in the merger agreement being true and correct, subject to the materiality standard contained in the merger agreement, and the performance by the other party in all material respects of its obligations under the merger agreement.
• The merger is subject to prior approval by the Federal Reserve Board under Section 3 of the Bank Holding Company Act of 1956, as amended, which we refer to as the “BHCA.”
• On April 28, 2005, Capital One filed a declaration with the Federal Reserve Bank of Richmond electing to become a “financial holding company” under the Gramm-Leach-Bliley Act amendments to the BHCA. The election became effective on May 27, 2005 and thus Capital One should have authority under the BHCA to acquire all of Hibernia’s subsidiaries.
• Approvals also will be required from certain other regulatory authorities in connection with the changes, as a result of the merger, in the ownership of certain businesses that are controlled by Hibernia. Ownership changes regarding registered broker-dealers controlled by Hibernia are subject to review by various regulatory and self- regulatory organizations, including the SEC, the National Association of Securities Dealers, Inc. and state regulatory authorities. The change in control of Hibernia’s insurance subsidiaries is subject to the receipt of necessary approvals from, or notice to, various U.S. state insurance regulatory authorities. Applications or notifications are being made to the insurance departments of those states. A notification regarding the change in control of Hibernia is also being filed with Louisiana state banking regulators.
• We currently expect to complete the merger on September 1, 2005, subject to Hibernia shareholders’ approval of the merger, the receipt of all necessary regulatory approvals and the expiration of all regulatory waiting periods prior to such date.

As we said, we think the closing will take place a little later in September. As we've noted, the comment deadline on the Federal Reserve application was June 3, 2005, and Matthew Lee submitted two comments. As we've also noted, for recent mergers, the average Federal Reserve review period following expiration of the comment period in cases where comments have been filed is 69 days, which would put the Federal Reserve approval here on or about August 11, 2005, and with the fifteen day waiting period, everything could be in place to complete the merger on September 1, 2005. However, as we've said, with this being COF's first entrance into the retail banking arena, we wouldn't be surprised to see the Federal Reserve review go a little long but we think the Federal Reserve approval will be in place in time for a late third quarter closing.

A little later than we expected but last night ASBC filed its preliminary S-4:

• No meeting date nor record date has been set for the ASBC shareholder meeting.
• If the merger is completed, each share of State Financial common stock will be converted into the right to receive 1.20 shares of Associated common stock (or cash for any fractional shares).
• Approval of the merger agreement will require the affirmative vote of a majority of the voting power of all of the issued and outstanding shares of State Financial common stock on the record date.
• State Financial has the right to terminate the merger agreement if the average closing price of shares of Associated common stock over a ten trading day period prior to the merger is less than $26.99 per share and the trading price of shares of Associated common stock underperforms an index of selected peer group stocks by more than 15% since the date of the merger agreement.
• Conditions to the Merger
  • shareholders of State Financial holding a majority of the outstanding shares of State Financial common stock vote in favor of the merger agreement;
  • no legal restraints or prohibitions exist which prevent the merger from being completed;
  • State Financial and Associated each receive a legal opinion that the merger will qualify as a reorganization under Section 368(a)(1)(A) of the Internal Revenue Code and no gain or loss will be recognized by any State Financial shareholder upon completion of the merger, except for cash received in lieu of any fractional shares; and
  • no event has occurred with respect to State Financial or Associated since the date of the merger agreement which has had or may reasonably be expected to have a material adverse effect on State Financial or Associated.
• Associated filed an application with the Federal Reserve Bank of Chicago that was accepted for filing by the Federal Reserve Bank of Chicago on May 25, 2005, and approved on , 2005, with respect to State Financial and its banking and non-banking subsidiaries, and all waiting periods have expired.
• The merger is also subject to the prior approval by the Wisconsin Department of Financial Institutions, or DFI. Wisconsin law provides for the publication of notice and public comment on the application and authorizes the DFI to permit interested parties to intervene in the proceedings. Associated filed an application with the DFI on May 25, 2005, that was approved on , 2005.
• We are working toward completing the merger as soon as practicable. We expect the merger to be completed shortly after the special meeting of State Financial’s shareholders, assuming all conditions to the merger have been satisfied, including receipt of all required shareholder and regulatory approvals.

When we spoke with the Federal Reserve Bank of Chicago earlier this month, they did not indicate that an application with the Federal Reserve had been filed. We did confirm the filing with the Wisconsin Department of Financial Institutions and also confirmed that an application was filed with the OCC on June 2, 2005. We'll try to clear up the discrepancy but as to timing, as we've been saying, we think the transaction timeline will be similar to the FTFC/ASBC deal, which took 184 days to complete and would put the closing here on or about September 21, 2005. As we've noted, the FTFC transaction was completed on October 29, 2004, which probably put the closing here on or about September 30, 2005.