L-1 Identity Solutions Inc. |ID
Safran SA

Deal value $1.1 billion

Spread 05/02/11 23 cents, or 2%

L-1 Identity Solutions Inc. and Safran SA of France refiled for the third time for their merger review by the Committee on Foreign Investment in the United States. The companies claim that they are making progress with the government toward a definitive mitigation agreement to gain approval for the $1.1 billion identity security services deal.

CFIUS is an interdepartmental executive branch committee led by the Treasury Department that reviews purchases of U.S. assets by foreign entities for national security purposes.

The refiling April 29 restarts an initial 30-day review that could be extended by a 45-day probe, but the L-1 deal has already been into the extended review period twice. It appears that the issues under review, likely by the Defense Department, are manageable.

L-1 provides identity security services that include biometrics, such as fingerprint and iris identification technology, and credential production services; about 90% its business is government related. The review is likely focused on sensitive information related to such documentation production.

Safran must pay a $75 million breakup fee if it cannot get the deal done.

Talecris Biotherapeutics Holdings|TLCR
Grifols SA

Deal value $4.1 billion

Spread 05/02/11 3.71, or 12.9%

Grifols SA and Talecris Biotherapeutics Holdings Corp. entered a consent agreement with the Federal Trade Commission to resolve the antitrust review of the plasma protein therapy combination.

The FTC issued a second request in August. The consent agreement remains subject to approval by the agency. The parties agreed to sell and lease manufacturing and licensing to Italy-based Kedrion SpA for up to seven years.

The deal terms call for the exchange $19 in cash and 0.6485 of a new, nonvoting Grifols share for each share of Talecris, which lays in the spread. The nonvoting issue could be valued at a 15% to 20% discount to Grifols' trading price in Madrid. But an arb argues that Grifols, after the close of the Talecris deal, could trade at a higher multiple, eliminating the nonvoting discount.

Tenet Healthcare Corp. |THC
Community Health Systems Inc. |CYH

Deal value $3.5 billion

Spread 05/02/11 56 cents, or 8.4%

Community Health Systems Inc. raised its unsolicited bid for Tenet Healthcare Corp. in the midst of counterclaims over how Community Health has billed Medicare.

CHS is now offering $7.25 per share, or $3.5 billion, for Tenet, which filed a lawsuit April 11 against CHS in the U.S. District Court for the Northern District of Texas asking the court to order additional disclosure regarding CHS' hospital admissions practices.

Tenet alleges CHS pushes patients through the observation status into hospital beds too aggressively.

CHS argues the observation criteria is meaningless and its standards are within industry norms. Medicare, CHS says, does not dictate specific criteria or screening guidelines for hospital admissions. The government does require hospitals to adopt criteria for internal reviews, but 25% of U.S. hospitals use criteria other than the standards used by Tenet in its lawsuit, CHS says.

Tenet intends to hold an annual meeting of its shareholders on Nov. 3, and CHS has proposed a slate of 10 directors to replace the Tenet board, which is not staggered. Tenet has a poison pill with a 4.9% trigger.