merger

ACI Worldwide, symbol ACIW on Nasdaq, makes software used to process transactions involving credit cards, debit cards, automated teller machines, point-of-sale terminals and interbank payments.

We analyze ACI in Stock Pickers Digest, our newsletter that recommends investments for the aggressive part of your stock portfolio.

In March 2011, ACI bought ICD Corp....

ACI WORLDWIDE, $36.17, symbol ACIW on Nasdaq, makes software used to process transactions involving credit cards, debit cards, automated teller machines, point-of-sale terminals and interbank payments. In March 2011, ACI bought ICD Corp. for an undisclosed amount. ICD has over 140 customers who use its software to authorize credit- and debit-card transactions through over 70 different payment processors, including banks and credit-card companies. ACI’s revenue rose 22.7% in the three months ended June 30, 2011, to $113.4 million from $92.4 million a year earlier. The company earned $9.8 million, or $0.29 a share, compared to a loss of $150,000, or nil per share, a year earlier. The company holds cash of $170.8 million, or $4.98 a share....

THOMSON REUTERS CORP. $35 (Toronto symbol TRI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 835.6 million; Market cap: $29.2 billion; Price-to-sales ratio: 2.1; Dividend yield: 3.4%; TSINetwork Rating: Above Average; www.thomsonreuters.com) has two main divisions: Markets (which supplied 57% of its 2010 revenue and 48% of its earnings) sells financialinformation products to banks and other financial institutions. Professional (43%, 52%) sells specialized information to professionals in the legal, accounting, scientific and health-care fields. Merger sent results soaring The company’s revenue rose 96.8%, from $6.6 billion in 2006 to $13.1 billion in 2010. That’s mainly because it bought the U.K.-based Reuters news agency for $16 billion in cash and shares in 2008 (all amounts except share price and market cap in U.S. dollars)....

These three beverage makers face rising ingredient costs. However, all three have restructured their operations, and the resulting savings have put them in a better position to face these challenges. As well, their strong brands will help them pass higher costs on to their customers. Moreover, all three are expanding in fast-growing overseas markets. PEPSICO INC. $69 (New York symbol PEP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.6 billion; Market cap: $110.4 billion; Price-to-sales ratio: 1.8; Dividend yield: 3.0%; TSINetwork Rating: Above Average; www.pepsico.com) is the world’s second-largest soft-drink maker, after Coca-Cola. It also makes other products, such as Frito-Lay snack foods, Tropicana fruit juices and Quaker Oats. Last year, PepsiCo bought its two main bottling firms, Pepsi Bottling Group Inc. and PepsiAmericas Inc., for $7.8 billion in cash and shares. Starting in 2012, the company should save $550 million a year by merging plants and administrative functions....

Exxon Mobil, $80.34, symbol XOM on New York (Shares outstanding: 4.9 billion; Market cap: $389.3 billion; www.exxonmobil.com), was formed in 1999, following the merger of Exxon and Mobil. It is the world’s largest publicly traded oil company. Exxon Mobil owns 70% of Imperial Oil, symbol IMO on Toronto. In the three months ended March 31, 2011, Exxon Mobil’s earnings jumped to $2.14 a share from $1.33 a year earlier. That beat the consensus estimate of $1.75. The improved performance came from higher oil and natural gas prices, increased refining margins, and record performance from the chemicals division. The company continues to buy back large amounts of its stock. In the latest quarter, it bought back 69 million shares for $5.7 billion....

Beer demand has slowed in Canada and other developed countries, due to high unemployment and the weak economic recovery. However, sales are growing strongly in emerging markets, where rising prosperity is making beer more affordable. Molson Coors is well-positioned to profit from this trend. The company owns some of the world’s top beer brands, particularly Coors Light. As well, it is forming partnerships with local brewers. Teaming up with well-established producers helps cut the risk of expanding in unfamiliar markets. Moreover, the company’s recent mergers continue to save it money. It is using these savings to expand and raise its dividend....

BANK OF NOVA SCOTIA $58.14, Toronto symbol BNS, has joined a new consortium called Maple Group Acquisition Corp. Other members include CIBC, TD Bank, National Bank and five major pension funds. Maple wants to buy a controlling interest in TMX GROUP $45, Toronto symbol X, which operates the Toronto Stock Exchange. TMX has already accepted a takeover offer from the London Stock Exchange. (Note that Royal Bank and Bank of Montreal are advising on that potential merger. That’s why they are not part of Maple.)...

Three of Canada’s big-five banks, BANK OF NOVA SCOTIA, $58.49, Toronto symbol BNS, CANADIAN IMPERIAL BANK OF COMMERCE, $84.40, Toronto symbol CM, and TORONTO-DOMINION BANK, $84.15, Toronto symbol TD, have joined a new consortium called Maple Group Acquisition Corp. Other members of this group include National Bank and five major pension funds. Maple wants to buy a controlling interest in TMX Group Inc. (Toronto symbol X), which operates the Toronto Stock Exchange, the TSX Venture Exchange and the Montreal Exchange. In February 2011, TMX accepted a takeover offer from the London Stock Exchange Group. Under the terms of that offer, TMX shareholders would own 45% of the combined company, which would be the world’s second-largest stock exchange by market cap....

Stanley Black & Decker Inc., New York symbol SWK, makes power and hand tools and security devices. It took its current form on March 12, 2010. That’s when Stanley Works bought the Black & Decker Corp. for $3.5 billion in stock. At the time of the merger, Stanley shareholders owned 50.5% of the combined company, and Black & Decker investors owned the remaining 49.5%. In the three months ended March 31, 2011, the company earned $157.8 million, or $0.92 a share, compared to a loss of $108.6 million, or $1.11 a share, a year earlier. Excluding charges relating to the merger, the growth stock’s earnings per share would have risen 54.3%, to $1.08 from $0.70. The growth stock’s sales rose 89.0% in the quarter, to $2.4 billion from $1.3 billion. If you assume the purchase occurred at the start of 2010, sales would have risen 4%....

Xerox Corp., symbol XRX on New York, makes copiers, laser printers and other publishing equipment. Xerox is one of the large cap stocks we analyze in our Wall Street Stock Forecaster newsletter. In February 2010, Xerox paid $6.5 billion for Affiliated Computer Services (ACS), which sells computer outsourcing services. Xerox now gets 80% of its revenue from long-term service contracts and recurring payments for supplies. That cut its risk....