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New Jersey mergers and acquisitions enjoyed a rebound in 2006, following a fall-off in the prior year. Deal statistics culled by Thomson Financial of New York, which tracks publicly traded companies’ M&A activity, show the value of the 30 largest deals in New Jersey reached $71.8 billion, nearly double the $43 billion reported for 2005. [See chart.] The 2006 total, though, was still less than the $81.7 million rung up 2004. In contrast to 2005, when the top mergers were distributed among a variety of companies and industries, two 2006 deals accounted for $31.3 billion, or nearly half of the value of the top 30. The largest was Johnson & Johnson Inc.’s acquisition of the Morris Plains consumer health-care division of Pfizer Inc. for $16.6 billion. The second largest was the $14.7 billion acquisition of Lucent Technologies Inc. in Murray Hill by Alcatel SA of Paris. The Thomson Financial data includes deals where the acquirer, the target or both are based in New Jersey. As usual, local firms did not see much of the M&A action. In fact, firms with offices in New Jersey were active in only seven of the 30 deals � and even then, the work was done mostly out of state. Dechert, and Morgan, Lewis & Bockius, which both have Princeton offices, advised Pfizer Inc. in the sale of its consumer health-care unit. Hughes Hubbard & Reed, which has an office in Jersey City, advised Burlington Coat Factory when it was acquired by Bain Capital for $1.8 billion, a transaction ranked as No. 7. Latham & Watkins advised East Coast Power, the owner of a Linden power plant, in its sale to GE Energy Financial Services Group for $1.7 billion, the No. 9-ranked deal. Latham represented Energy Capital Partners, a Short Hills private equity company, in its $1.3 billion purchase of a total of 15 Massachusetts and Connecticut-based power generation plants owned by Northeast Utilities, a Connecticut power company. That deal was ranked No. 10. Latham was also one of the firms representing San Francisco’s Sima Therapeutics, when it was sold for $1 billion to Whitehouse Station’s Merck & Co. in the 14th largest deal on the list. Latham and other firms represented an East Rutherford pharmaceutical company, Cambrex Corp., in the $460 million sale of its Bioproducts and Biopharma subsidiaries to Lonza Group Ltd., a Swiss company. That deal was ranked No. 25. Only one New Jersey-based firm, Lowenstein Sandler, even made the list of M&As. In a $77.5 million deal ranked No. 80, the Roseland firm represented Hotspot FX, a Jersey City foreign exchange trading services company, when it was acquired by Knight Capital. Lowenstein Sandler also represented Iridian Technologies when the Moorestown iris-recognition technology company was sold to Viisage Technology Inc. for $35 million. That deal was ranked No. 110. Anthony Pergola of Lowenstein, who was involved in the Hotspot FX deal, says many of his firm’s M&A deals fall under the radar of companies like Thomson. “We’ve done at least 40 deals in 2006,” he says. “But most were with privately held companies, which would not be picked up on the Thomson list.” Andrew Gilbert, of Morgan, Lewis, is not surprised by the paucity of New Jersey firms’ M&A activity. Gilbert says an existing relationship with a target company or an acquirer can make a difference in snaring an M&A. His Princeton office advised Princeton eCom Corp. when it was bought by publicly traded Online Resources Corp. for $190 million, in a deal ranked as No. 46. “We represented Princeton eCom for five years, in a number of venture capital transactions,” says Gilbert, explaining how his firm got the assignment. But owing to the acquisition, Morgan Lewis lost the client. “Princeton’s new owner � has its own legal counsel,” says Gilbert. New York firms Weil Gotshal & Manges and Dewey Ballantine led the activity with five transactions each. Weil advised the acquirer four times and the target once. Dewey represented the acquirer twice, and the target three times. New York firms Cravath Swain & Moore, Fried Frank Harris Shriver & Jacobson, and Sullivan & Cromwell, and Latham & Watkins in Los Angeles followed, with four transactions apiece.

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