Target Corporation (NYSE:TGT) found itself in talks with Pershing Square’s William Ackman after the activist boosted his stake in the company from 9.6 to 10 percent and owns derivative contracts that amounting to an economic interest of around 12.6 percent. The activist investor acknowledged that Target is “probably the best retailer in the world” and announced that it was in talks with management to boost the share price. Shareholders are hoping that the activist will take action to unlock value.

Target shares have fell 21 percent since Ackman first disclosed his holdings, but the activist maintains that the company is in good shape. Many investors believe that Ackman is focused on the company’s possible sale of its $7 billion credit portfolio, which was delayed due to evaluations taking longer than expected as a result of the current credit market conditions. Shares have continued to slide recently on news of delays in this decision that could prove to be a windfall for shareholders if approved.

William Ackman is an activist investor that previously took stakes in Wendy’s, McDonalds, and Ceridian and unlocked value by pushing management to improve profits and cut costs by selling or spinning off divisions. Investors are hoping that the activist will be able to unlock value in Target. Combined, these factors make TGT a stock worth watching!

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Merrill Lynch (NYSE:MER) shares led the financials higher today after the company announced that it had sold its commercial finance unit and raised $6.2 billion through a private placement to Temasek and Davis. The move comes after the firm announced record writedowns amid a credit crunch and subprime crisis that wrecked havoc on its asset backed securities. The firm is widely expected to face more writedowns, but these events give investors new hope that a bottom may be near.

General Electric purchased Merrill’s commercial finance unit, which will enable the firm to redeploy approximately $1.3 billion in capital. The sale includes the firm’s corporate finance, equipment finance, franchise, energy and healthcare finance units, but not the commercial real estate finance unit. The deal will add more than $10 billion in assets and $5 billion in other commitments to GE Capital Commercial Finance’s businesses, which currently stands at around $260 billion.

Meanwhile, Temasek Holdings purchased $5 billion of newly issued Merrill stock at a price of $48 per share through a private placement of newly issued common stock. Davis Selected Advisors also purchased another $1.2 billion at an unknown price per share. Some investors are upset that the company was willing to dilute their stake at a price of just $48 per share, but it is likely that the two investors had a chance to take a look at the company’s books and felt that that was a fair price given future writedowns. Regardless, the firm now has increased liquidity and more investors.

In the end, both of these are great news for Merrill Lynch shareholders as it provides the company with greater liquidity while also showing at least some confidence in the company’s stocks. Combined, these factors make MER a stock worth watching!

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BEA Systems Inc. (NDAQ:BEAS) announced that it would postpone its annual shareholders’ meeting in a move that would sidestep a lawsuit by Carl Icahn and give the business software-maker more time to drum up bids closer to its $21/share target. The company now has more time to get itself out of this mess, but it is uncertain as to whether or not Icahn will attempt to install his own directors regardless. Shareholders are watching the situation closely as it could mean significant value being unlocked.

Carl Icahn launched his campaign to put the company up for sale a few months ago when he sued BEA’s board of directors and threatened to replace them with his own candidates. The activist investor hasn’t filed any of the necessary paperwork to nominate his own directors, but this delay may give him enough time to do so. This assumption has gained traction in light of the fact that Icahn supported this delay while criticizing past delays.

Carl Icahn has been critical of BEAS ever since it rejected a bid from Oracle at $17 per share, or $6.7 billion. The company insisted that it was worth more and suggested that future negotiations should start at $21 per share, which it is just now attempting to realize. So far, no other bidders have emerged and Oracle’s Larry Elison even suggested that the company wasn’t even worth the original $17 per share offer. Whether or not the company can drum up some bids remains to be seen, but with Carl Icahn’s support, this is a situation that is definitely worth watching!

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