Berkshire Hathaway (NYSE:BRK) revealed yesterday in a 13F/A filing with the SEC afterhours that it had taken a 5.5% stake in Target Corp. (NYSE:TGT) with purchases dating back to June 30th. This news isn't particularly suprising given Buffet's investment in competitor Walmart; however, share in the retailer climbed over 1% today on the news as investors look to follow the Oracle of Omaha's lead. According to the filing, Buffet's average price was $50.30, which means he is already sitting on a nice 17% profit as shares near $60. Buffet is known for investing for the long-term in significantly undervalued companies, meaning that he is likely expecting much more upside. Investors should keep an eye on future SEC filings by Buffet, in particular Form 4s which indicate further purchasing of TGT shares.

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Merck & Co. Inc. (NYSE:MRK) agreed to buyout Sirna Therapeutics (NDAQ:RNAI) at a 100% premium yesterday in a transaction worth $1.1 billion. This acquisition is noteworthy because it is the first time that a large pharma player recognized RNAi technologies as a key technology. RNA interference (RNAi) technology selectively catalyze the destruction of the RNA transcribed in a single gene, allowing the drug to produce a highly specific, potent, and long-lasting effects to treat diseases much more effectively. Most notably is its potential for treating cancer, which is the reason Merck gave for the buyout.

This acquisition helped boost other RNAi players, like Alnylam Pharmaceuticals Inc. (NDAQ:ALNY), which rose 20% in today's trading, and Nastech Pharmaceutical (NDAQ:NSTK), which rose 5% today. If other larger pharma players take interest in the RNAi technologies, these two companies would be likely acquisition targets, which makes them stocks worth keeping an eye on!

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Marsh & McLennan Companies, Inc. (NYSE:MMC) has found itself engulfed a whirlwind of M&A activity as yet another buyer has surfaced that is interested one of its divisions. This time the Sunday Times has reported that founder Jules Kroll is interested in buying back Kroll Inc. for $1.9 billion, a company which MMC purchased from Jules just two years ago.

The company has also been under pressure from shareholders to sell off its Putnam Investments division, which has been the subject of many acquisition offers and partnership requests. Finally, the Sunday Times also reported a few weeks ago that the Willis Group had made an offer with backing from Kohlberg Kravis Roberts LLC, which was later rebuffed by MMC and said to be merely "conjecture and speculation" by the Willis Group. Combined, all of these factors are causing shareholders to consider the notion of breaking up the company, which could result in substantial premiums to the current market prices. This is definitely a stock worth keeping an eye on!

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Infocrossing, Inc. (NDAQ:IFOX) revealed in a 13D/A filing with the SEC today that RLR Capital Partners has upped its stake in the company to 6.2% from 5.1% in June of this year. The fund has averaged in at around $11 since that time as the stock rose to the high $12s, netting them a nice 14% profit so far. The company also said in their original 13D filing in June that they have other plans for the company:

"The Fund originally acquired Shares for investment in the ordinary course of business because the Reporting Persons believed that the Shares, when purchased, were substantially undervalued and represented an attractive investment opportunity. The Reporting Persons have communicated with management of the Issuer, and expect to continue to do so, regarding the Company's business and prospects. On June 15, 2006, the Reporting Persons sent a letter to the Issuer regarding the Reporting Persons' prior meetings with the Issuer and forthcoming value creating strategic and capital structure opportunities. A copy of the letter is attached hereto as Exhibit 1 and is incorporated herein by reference.

We believe that the coming months will offer Infocrossing the opportunity to explore value creating strategic and capital structure opportunities.  No other independent U.S. company in your industry  offers the range of service capabilities you provide. We are confident that you and your board will focus on the best available alternatives to capitalize on your very favorable industry positioning in order to enhance shareholder value." (Read More)

IFOX is currently trading at a discount to its enterprise value; however, it's PEG shows that it may be slightly overvalued if it cannot improve its growth in the coming quarters. However, with a hedge fund in the game to keep the company on track and mindful of shareholder concerns, this may turn out to be a stock worth watching. Any changes in capital structure or strategy could help the company cut costs and improve their bottom line.

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Rinker Group (NYSE:RIN) received a buyout offer for $11.7 billion (or about $65 per share) in cash from Cemex (NYSE:CX) on Friday that it today called "highly conditional" and one that "materially undervalues the company". With the stock currently trading above $71, investors are clearly looking for more too.

According to the SC 14D9 filing with the SEC:

"On Friday 27 October 2006, Cemex S.A.B. de C.V. (“Cemex”) announced that it intends to make a cash takeover offer for Rinker Group Limited (Rinker) at US$13.00 per share, equivalent to A$17.00 per share (based on an average exchange rate of A$1.00 to US$0.7645). A copy of that announcement was sent to Rinker by Cemex and is attached.

Rinker Chairman John Morschel said the Cemex announcement indicates that the unsolicited, hostile offer will be highly conditional.

'The preliminary view of the Rinker Board is that the proposed offer is opportunistic and materially undervalues the company,' he said.

Mr Morschel said Rinker’s performance of 40% compound annual growth in earnings per share over the past five years, together with strong growth in revenue (19% p.a. compound) and earnings before interest and tax (33% p.a. compound), has made it one of the best performing construction materials companies in the world.

'Directors will keep shareholders fully informed of further developments and will provide a formal recommendation on the offer in ample time for shareholders to make an informed decision,' he said.

'Shareholders should take no action in relation to Cemex’s offer at this time or any document received from Cemex until they receive the directors’ formal recommendation.'

Rinker has retained UBS as its financial adviser in relation to the proposed offer." (Read More)

This stock is definitely one to keep an eye on as both management and investors are looking for a better offer. It is not uncommon in these situations for the bidder to raise the bid one or more times to satisfy at least one of the two groups.

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Energy Partners, Ltd. (NYSE:EPL) provided an update on its search for strategic alternatives in an 8K filing with the SEC today. In an attached press release, Chairman and CEO Bachmann said:

"We are committed to continuing our process of exploring all options to maximize stockholder value, including a possible sale of the Company. A number of parties have already signed or have agreed to sign confidentiality agreements, and we are entertaining interest from others. Woodside's ultimatum and disingenuous rhetoric will not deter our Board of Directors from pursuing the best interests of all EPL stockholders.

"Woodside's self-serving behavior is very disappointing. We have not heard a word from them since our Board announced its process to explore strategic alternatives on October 12, 2006, and they have not sought to participate in this process, as many other companies are doing. In addition, Woodside has backtracked on its promise to pass through to EPL stockholders the savings from a reduced Stone termination fee, effectively reducing its original offer." (Read More)

If the company can successfully find another buyer, it could mean a significant premium to today's prices. With "a number of parties" having already signed confidentiality agreements, this buyout possibility may have some merit. This makes EPL a stock definitely worth watching as the company continues to explore its options.

Cheniere Energy Inc. (AMEX:LNG) revealed today in a 13D filing with the SEC that SRM Global Master Fund had taken a 6.5% stake in the company. The filing said that the fund would review their investment on a continuing basis and may engage in discussions with management concerning the business and future plans. The real story here is in SRM Global, however.

SRM Global is a relatively new hedge fund, launched by Jon Wood - who brought in over $2.4 billion for UBS in six years before launching his own fund. This new hedge fund focuses on trading shares of organizations that are merging, capital structure arbitrage (price difference between related corporate securities), and investment in industries and stocks that are not doing so well or are in trouble. Given his incredible track record, any investment by SRM Global makes this stock definitely one worth watching.

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Hillenbrand Industries, Inc. (NYSE:HB) said today in a press release that the company would consider splitting its healthcare and funeral businesses into two seperate publicly traded companies, after having evaluated strategic alternatives for the company.

According to the press release:

"Hillenbrand's Board of Directors and senior leadership recently evaluated a range of strategic alternatives, with input from its financial advisors Citigroup Corporate and Investment Banking and Goldman Sachs Group. These alternatives included the continuation of Hillenbrand's current operating structure, the sale of one or both of its businesses, returning cash to shareholders through an increase in balance sheet leverage, and the spin-off of or split off of one of its businesses. Having reviewed and fully endorsed the operating strategies presented at today's Investor Conference, management and the Board concluded that separating Hillenbrand's current operations into two publicly traded companies merits further, more detailed consideration as a means to position Hillenbrand's market-leading healthcare and funeral services businesses for sustained growth and value creation."

The company also has the full support of the Board as well as outside advisers that the company had hired to investigate the issue. The Chairman of the Board of Directors said:

"Under the leadership of Peter Soderberg, our new CEO, the management team has been working diligently to develop a motivating and achievable plan for growth for its two operating companies. I am pleased to report that the strategy we unveiled today has the enthusiastic support of the Board. Concurrently, the Board and management have been working with outside advisors to explore the alternatives available to enhance shareholder value and best assure achievement of our strategic vision. We believe the Board should undertake further exploration of the merits and mechanisms of a potential separation of the healthcare and funeral services businesses into two publicly traded companies."

Companies that restructure through splitting operations generally see significant gains as independent companies. By focusing on one area instead of many, companies are often able to cut costs and streamline operations while improving revenues through more effective marketing. This is especially true for unrelated businesses that exhibit little or no synergy within the same company. Combined, these factors make this company one to watch closely as the Board continues to investigate the possibility.

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Visteon Corp. (NYSE:VC) is again seeing its stock being accumulated by Pardus Capital. The hedge fund rose its stake in the company to 15.6%, but did not make additional comments about their strategy or plans. See our previous article for more information about Pardus' interest in the company.

In past filings, they noted that they would:

"continue to engage in discussions from time to time with management, the Board of Directors, other shareholders of the Issuer and other relevant parties concerning, among other things, the business, operations, board composition, management, strategy and future plans of the Issuer. In the context of these discussions, the Reporting Persons have raised with the Issuer the possibility of an individual suggested by them joining the board, and have been informed that the Issuer has taken this matter under advisement."

The company continues to struggle after Pardus' last purchase in September after Valeo withdrew its bid for the company. The stock is, however, up over 3% today on the news. This stock is definitely one worth watching as Pardus has a large stake in the company and continues to accumulate shares.

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The Mills Corporation (NYSE:MLS) may be recapitalized with an additional $1.2 billion by Gazit-Globe Ltd, according to a 13D/A filing with the SEC. Many investors are concerned that the company may sell itself at its current prices, which are significantly lower than historical levels. This new recapitalization offer would allocate enough money for the company to rebuild itself and recover some of its lost value. Investors applauded the idea as the stock moved up 14% today on the news.

A letter filed with their 13D/A gave more details:

"Chaim Katzman, Gazit-Globe’s chairman, said his company’s goal is to recapitalize what it views as a struggling Mills Corporation, and that it is prepared to 'invest up to $1.2 billion into Mills' in accordance with the terms outlined in the Schedule 13D that Gazit has filed with the Securities and Exchange Commission [seen below].

'It is not a question of whether or not the board must take action to ensure the continuity of Mills in order to restore profitability and leadership in the industry,' said Katzman, 'but rather what kind of action is necessary and appropriate.'

'At this point it is clear to us that an outright sale of the company is not in the best interests of shareholders,' continued Katzman. “We’re urging the Mills’ board of directors in the strongest terms possible to consider our recapitalization proposal.'

'We believe Mills can and should be rebuilt, and not sold,' said Katzman, who added that his recent discussions with Mills leadership left him concerned that the company might elect to simply sell itself at a distressed price. 'We have helped build and rebuild companies over the years. We know how to take companies such as this and re-energize them so that maximum shareholder value is achieved.'" (Read More)

In an earlier filing, they detailed the capitalization amounts and other considerations:

"As you are aware, we are also a significant stockholder in the Company with an approximate 4.9% [now 9%] ownership interest. Due to our ownership position, we are not in a position at this stage in the process to execute the confidentiality agreement the Company has circulated as a precondition to obtaining material non-public information. Rather, we strongly encourage the Company to make all relevant financial and other information public as soon as possible so that we, and other potential bidders who may have similar issues to ours, may participate in the bidding process and enhance stockholder opportunities to achieve the best value for the Company.

Based upon our extensive review of the currently available public information, and, as discussed below, our in-depth property analysis, we are prepared to recapitalize the Company by investing new capital in the form of common stock. The cash amount would be up to $1.2 billion at a price per share of $24.50. This new common stock would be classified as Series B and would entitle Gazit to a majority of the seats on the Company’s board. The new common stock would also be convertible into the currently outstanding series of common stock. This new investment would be in addition to our current holdings of the Company's common stock." (Read More)

This is definitely a stock to keep an eye on as this situation unfolds. If Gazit-Globe is successful in recapitalizing the company and rebuilding shareholder value it could mean a significant return in the medium-term.

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USI Holdings Corporation (NDAQ:USIH) announced in an 8K filing with the SEC yesterday after the bell that they received a buyout offer from a private equity firm. The company gave no details as to the buyout price; however, they stated that they would review the offer. According to the associated press release:

"USI Holdings Corporation today announced that in response to an indication of interest received from a private equity firm in acquiring all of the outstanding common stock of the Company, the Board of Directors of the Company has formed a Special Committee consisting of outside directors to review the proposal and consider all of the Company's options. Lazard Frères & Co. LLC and Dewey Ballantine LLP have been engaged by the Special Committee to assist in its review. No assurance can be given that any transaction will be entered into or consummated." (Read More)

Investors pushed the stock up 7% in today's trading on the news. The company is currently undervalued, trading at a 20% discount to enterprise value with a PEG ratio of only 0.91. The company also has healthy profit margins and an excellent track record. This is definitely a stock to watch as the buyout premium cuold easily end up being higher than the 7% jump we've seen so far today.

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Clear Channel Communications, Inc. (NYSE:CCU)
Press Release by the Company
The company confirmed today that its Board of Directors is evaluating various strategic alternatives to enhance shareholder value. The company has retained Goldman, Sachs & Co. as its financial advisor in connection with its evaluations. The stock moved up 6% after-hours today on the news, despite the fact that the Company said it "does not intend to comment further publicly with respect to the exploration of strategic alternatives unless a specific transaction is approved by its Board."

ImClone Systems, Inc. (NDAQ:IMCL)
8K Filing by the Company
After two months of fighting, Carl Icahn has finally succeeded in taking over the company in a "bloodless coup", with the help of some nice severance packages. Investors applauded the new management as the stock rose over 5% in today's trading. Icahn said in a prepared statement: "My immediate priorities as chairman are to investigate the reasons why the relationship between ImClone Systems and its partner, Bristol-Myers Squibb, has seriously deteriorated over the past few years and to act expeditiously to find a qualified CEO with biotechnology experience."

Integral Systems, Inc. (NDAQ:ISYS)
8K Filing by the Company
According to the filing, "The Company’s efforts to date in connection with exploring strategic alternatives have focused principally on a possible sale of the Company. Because discussions with potential interested parties have to date not resulted in any proposal, agreement or transaction involving a sale of the Company, the Board of Directors of the Company has, after consultation with the Company’s outside financial advisors, decided to explore and evaluate other strategic alternatives to maximize stockholder value while continuing to explore and evaluate a possible sale of the Company."

Martha Stewart Living Omnimedia, Inc. (NYSE:MSO) moved higher today by 4% after CNBC mentioned that the company could become a private buyout target. Whether or not this rumor could be substanciated is the cause of much debate on the street. Many argue that by going private Martha Stewart would be able to again take a position as head of the company after being banned by the SEC after her insider trading fiasco. Moreover, the company is slowly beginning to improve their bottom line. However skeptics are quick to point out that there are many risks that still exist, and it would not be prudent for management to consider such a transaction while these remain on the table. Whether or not these rumors turn out to be true remains to be seen; however, this is a good stock to keep on the radar incase such a transaction ever materializes.

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The Gap, Inc. (NYSE:GPS) revealed today in a Form 4 filing with the SEC that Chairman Robert Fisher sold one million shares on October 19th and 20th at prices averaging $19.45. Although the majority of this sale was by trusts, Fisher did personally sell over 250,000 shares. This sale comes as Gap recently moved higher after it announced that it would launch on online shoe store to compete with Zappos.com, called Piperlime. Many insist that Piperlime does not have a chance at competing with Zappos or other online shoe stores, and will actually lose money as a result of their liberal shipping and return policies. Whether the sale of shares is simply a diversification move or a hint to future problems with Piperlime or other areas of the company remains to be seen.

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Douglas Emmett, Inc. (NYSE:DEI) began trading on the NYSE today after adding shares and pricing itself on the upper end of its $19 to $21 range. According to their S-11 filing with the SEC:

"We are one of the largest owners and operators of high-quality office and multifamily properties in Los Angeles County, California and have a growing presence in Honolulu, Hawaii. Our presence in Los Angeles and Honolulu is the result of a consistent and focused strategy of identifying submarkets that are supply constrained, have high barriers to entry and exhibit strong economic characteristics such as population and job growth and a diverse economic base. In our office portfolio, we focus primarily on owning and acquiring a substantial share of top-tier office properties within these submarkets and which are located near high-end executive housing and key lifestyle amenities. In our multifamily portfolio, we focus primarily on owning and acquiring select properties at premier locations within these same submarkets. We believe our strategy generally allows us to achieve higher than market-average rents and occupancy levels, while also creating operating efficiencies." (Read More)

This IPO comes as the REITs are seeing renewed strength in commercial real estate while the overall housing sector continues to suffer with purchasing slowdowns and higher interest rates. DEI is only the fourth company to raise over $1 billion this year through an IPO, following Mastercard, SAIC, and Warner Chilcott. This stock is definitely one to watch as the commercial real estate market continues to make inroads.

CSK Auto Corp. (NYSE:CAO)
13D/A Filing by Karsch Capital Management
Karsch announced today in an amended 13D filing that it wants the company to include in its proxy materials for the next annual meeting a proposal that the company immediately hire an investment banking firm to pursue a sale. This is the second letter that the fund has sent to the company containing such demands.

IntercontinentalExchange, Inc. (NYSE:ICE)
13D/A Filing by Goldman Sachs
Goldman Sachs revealed today that it is still actively selling its stake in IntercontinentalExchange along with Morgan Stanley. The two financial institutions were both initial partners with ICE (an OTC and Energy exchange) since its IPO in 2005.

NetManage, Inc. (NDAQ:NETM)
8K Filing by the Company
The company revealed in an 8K filing with the SEC today that their Board "has determined not to enter into negotiations with Riley Investment Management, LLC and Zeff Capital Partners, L.P., each a stockholder of NetManage, regarding their interest in acquiring all outstanding shares of NetManage common stock that they do not already own." The offer was for $5.25 per share in cash.

The Wall Street Journal reported today that Tribune Company (NYSE:TRB) has caught the eye of at least three private equity firms, and could begin receiving bids for the company this month. We first began reporting on this rumor back in September, when there was talk of a LBO in the future. According to the WSJ, Madison Dearborn Partners, Providence Equity Partners and Apollo Management make up one of the groups, while Thomas H. Lee Partners and Texas Pacific Group have combined to form another, citing sources with knowledge of the situation.

Since buyouts typically come at a significant premium to the prevailing market price, this stock may be worth watching. Moreover, the possibility of a bidding war between two groups of funds make it not only a safer bet that a buyout would go through, but also more likely that it would go through at a higher price. The stock is currently trading up around 2.5% on the news.

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Talk America (NDAQ:TALK) moved down 10% today after Sun Partners withdrew its $9 cash bid for the company (covered in a previous article). According to an 8K filing with the SEC:

"On October 23, 2006, Talk America Holdings, Inc. issued a release announcing that Sun Capital Securities Group, LLC (“Sun Capital”) had advised Talk America that it has determined, after extensive due diligence review and consideration, that it would not make a definitive offer to acquire Talk America at a price greater than the $8.10 price per share provided under Talk America’s September 22, 2006 merger agreement with Cavalier Telephone Corporation and, accordingly, that Sun Capital was withdrawing its earlier conditional proposal to acquire Talk America."

Currently the stock is trading at around $7.85 per share, which represents a 3% discount to the $8.10 offer, which is still likely to go through. However, some investors are now concerned that Sun Partners may have found a problem in their extensive review of the company that may jeapordize the $8.10 per share offer.

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Quipp, Inc. (NDAQ:QUIP) may soon find itself in hot water as hedge funds Henry Partners and Matthew Partners (9.4% owners) demanded that the company immediately put itself up for sale or institute other measures designed to help unlock shareholder value. The hedge funds made seven comments/demands, highlighted in a letter attached to a 13D filing made today:

"1. We believe the best strategic alternative is for Quipp to agree to be sold now to the highest bidder in an arms-length transaction. We believe that Quipp's shareholders should then have the opportunity to decide at a special meeting whether or not the agreed upon consideration is acceptable to them. For the record, we have no intention of being a bidder for Quipp.

2. We are strongly opposed to, and would not support, Quipp making any additional acquisitions. Our opposition to such a step is based on the consideration paid in the Newstec acquisition, and the subsequent poor results of that unit as disclosed in Quipp's quarterly filings.

3. We are also strongly opposed to Quipp parting with any more of its cash reserves, unless such cash is distributed, or otherwise returned, solely to Quipp's shareholders.

4. We are strongly opposed to, and would not support, any effort by Quipp to pursue a "going dark" process. We believe that any cost savings purportedly offered by such a step are far outweighed by the potential further loss of both public market value and transparency that "going dark" actions typically result in.

5. If, for whatever reason, Quipp is not sold to a third party in the near term, we believe that Quipp should continue for the time being as a publicly-traded entity, with management focused solely on managing the now-existing business for maximum profitability, rather than seeking further acquisitions.

6. In conjunction with Quipp continuing as a publicly-traded entity, we would expect a further reshaping of the membership of the Board of Directors such that more representatives of Quipp's major shareholders are offered the opportunity to serve on Quipp's Board in place of its current members, some of whom may wish to retire from the Board. As one of Quipp's largest shareholders, we would expect to participate in that process.

7. As a further part of Quipp continuing its public company status, we strongly believe the shareholder rights plan should be repealed and not reinstated without the prior approval of Quipp's shareholders, and that all Quipp directors be required to purchase in the open market, with their own funds, a realistic, yet meaningful quantity of Quipp shares so as to align more closely their thinking with that of the actual owners of the business." (Read More)

Investors have struggled with the company for several years, as it moved down from $16 in 2004 to its current range between $7 and $8 per share. If these hedge funds can succeed in putting the company up for sale, it could result in quick short-term gains. However, even if the company cannot be sold, if the funds are successful in instituting their own Board members, it could spell a turnaround for the company in the medium to long term. Board members are typically (essentially) chosen by the company's management, and therefore rarely enforce measures designed to help shareholders at the expense of management. With large investors holding seats on the Board, more measures could be instituted to unlock shareholder value and curb spending.

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ExlService Holdings, Inc. (NDAQ:EXLS)
S-1 Filing by the Company
ExlService IPO'd today at $13.50 per share, above its expected range of $10 to $12 per share. The stock moved up to $17.13 after its debut, up nearly 27%. ExlService Holdings, Inc. is a recognized provider of end-to-end offshore services, including Business Process Outsourcing (BPO), research and analytics, and risk advisory services. It primarily serves the needs of Global 1000 companies in the banking, financial services and insurance sector.

Granite Construction Incorporated (NYSE:GVA)
Press Release
Granite Construction issued a statement today in response to rumors that the company is a potential takeover target. According to the company "they are not aware of any developments that would substantiate a rumor contained in a news article issued yesterday that speculates of a possible takeover of Granite Construction."

Optimal Group, Inc. (NDAQ:OPMR)
13D/A Filing by Clinton Group
Optimal Group received a letter from the Clinton Group today, via a 13D filing with the SEC, urging them to return a portion of their large cash position to shareholders through a special dividend or share buyback. Moreover, the letter demanded that the company immediately attempt to put itself up for sale. If any of these actions materialize, it could mean significant returns for shareholders in the short term.

Google Inc. (NDAQ:GOOG) reported in an 8K filing after-hours yesterday that they topped earnings estimates by $0.20, coming in at $2.62. The company impressed analysts with a net income that nearly doubled to $733.4 million while they reported that their foreign market share rose from 39% to 44%. These results suprised analysts as the stock traded up over 6% at open today.

The primary concern that investors had going into the quarter was the fact that Google was spending too much money without showing significant improvements in their bottom line. The numbers released yesterday relieved these concerns as well as some copyright infringement concerns that investors had concerning the acquisition of YouTube. The company noted that federal legislation protected the company so long as it made "good faith" efforts to remove material that infringed on intellectual property rights. All together, this release boded well for the company, as many investors are expecting Google to hit $500 before heading lower.

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Texas Industries, Inc. (NYSE:TXI) may be targetted by Nassef Sawiris/NNS Holding, who disclosed a 2.3% stake in the company today via a 13D filing with the SEC. Mr. Sawiris also disclosed a series of derivative holdings, which (if exercised) would give him a 9.1% stake in the company. In the 13D filing, Nassef opened up the possibility for a sale of the company:

"The Reporting Persons purchased the Securities based on the Reporting Persons’ belief that the Issuer’s common stock at current market prices is undervalued and represents an attractive investment opportunity. However, Mr. Sawiris has had communications with the Issuer and it is anticipated that Mr. Sawiris may, from time to time, have discussions with management, the board of directors and other shareholders of the Issuer.

Depending upon overall market conditions, other investment opportunities available to the Reporting Persons, and the availability of shares of the Issuer’s common stock at prices that would make the purchase of additional shares desirable, the Reporting Persons may endeavor to increase their position in the Issuer through, among other things, the purchase of shares of the Issuer’s common stock or options on such shares on the open market or in private transactions, through a tender offer or otherwise, on such terms and at such times as the Reporting Persons may deem advisable.

The Reporting Persons intend to actively monitor efforts by management to increase stockholder value. The Reporting Persons may also decide in the future to propose a transaction whereby all or a portion of the Issuer be sold, and in connection therewith the Reporting Persons may seek to participate in such transaction or seek to acquire control of the Issuer in a negotiated transaction or otherwise. If it should acquire control of the Issuer, it may transfer all or part of it to affiliated or unaffiliated persons. The Reporting Persons also may seek in the future to have one or more representatives elected to the board of directors or to propose other matters for consideration and approval by the Issuer’s stockholders or board of directors." (Read More)

It is worth noting that Mr. Sawiris is involved in the heavy materials business himself, which enhances the odds of a potential sale of the company. And although Texas Industries isn't particularly cheap at these levels, it does have a nice piece of the heavy materials market share in the southern United States. This is definitely a stock to watch as this situation unfolds, as any sale of the company would command a premium to the current market price. The stock is currently up over 3% on the news.

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Cypress Semiconductor (NYSE:CY) reported Q3 earnings of $0.16/share, beating estimates by $0.02. The company also announced that it would terminate its plan to explore the possibility of a sale. The president and CEO of the company said:

"Cypress's third-quarter revenue of $290.2 million was up for the sixth consecutive quarter, reaching its highest point since the fourth quarter of 2000, the Company's all-time revenue record quarter. Net income also increased for the sixth straight quarter. Our gross margins were affected by manufacturing limitations which we expect to improve going forward."

The stock moved down almost 10% in early trading today on the news that the company would no longer be exploring a buyout. Right now, the company is overvalued in terms of its PE/G; however, it does have a sizable cash position that could be used to improve operations or returned to shareholders through dividends or share buybacks. This news also comes after SAC Capital made several sizable purchases in the company, revealed in recent 13G filings with the SEC. If the stock continues to get cheaper while SAC Capital and other insiders continue to hold their shares, CY could become an attractive investment opportunity in the near future.

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Integrated Device Technologies, Inc. (IDTI)
Texas Instruments Incorporated (TXN)

NYMEX Holdings (NDAQ:NMX)
S-1 Filing by the Company
NYMEX Holdings - parent company of the New York Merchantile Exchange - revealed today in an ammended S-1 filing with the SEC that they see an IPO price of $48 - $52 per share. With the recent M&A activity surrounding exchange companies, NYMEX (the world's third largest future's brokerage) is likely to see significant upside after it IPOs.

Time Warner Cable (NYSE:TWC)
S-1 Filing by the Company
Time Warner Cable - a subsidiary of Time Warner - revealed today in an S-1 filing with the SEC that it planned to IPO. Many investors maintain that cable companies are among the best cash flow generators in the market today; however, there are very few pure plays. With the TWC IPO, there will not only be a pure play, but also a boost for TWX, who owns over 8% of class A shares and all of the class B shares.

Abbott Laboratories (NYSE:ABT) reported in an 8K filing with the SEC that their Q3 results are inline with estimates while guiding within analyst estimates. The company also announced a $2.5 billion share buyback program. According to the press release, "The purchases may be made from time to time as market conditions warrant and subject to regulatory considerations. The timing and amounts of any purchases will be determined by the company's management. The share repurchase authorization has no time limit and may be discontinued at any time." This news comes as the company's stock is struggling to make progress beyond its $40-50 range that it has been locked into since mid-2003. The buyback would represent 3.4% of the company's current market cap.

Related Companies
Boston Scientific Corp. (BSX)
Johnson & Johnson (JNJ)
Bayer AG (BAY)

First Mercury Financial Corporation (NYSE:FMR) opened for trading today on the NYSE at $17.00 per share - in the middle of its $16 - $18 range. The stock is currently trading at $19.30 in intraday trading today, moving up 13%.

FMR markets and underwrites specialty commercial insurance products, focusing on niche and underserved segments where the company has underwriting expertise and other competitive advantages. More specifically, the company focuses on underwriting insurance in the security industry, which includes security guards and detectives, alarm installation and service businesses, and safety equipment installation and service businesses, which they have done for over 33 years. Although this gives the company a great edge in this industry, the lack of revenue diversification does increase the risk of investment. However, unlike most companies, First Mercury filed 10Q statements dating back to 1996 before its IPO, giving investors a good look into its business. These documents show a company that has a strong balance sheet and a business that continues to grow in a great niche. This is definitely a stock to keep an eye on for possible investment after the IPO dust settles and a fair valuation can be calculated.

Marvell Technology Group Ltd. (NDAQ:MRVL)
8K Filing by the Company
Marvell Technology announced today in an 8K filing with the SEC that the company was meeting with leaders at Intel today to further discuss their acquisition of Intel's communications and application processor business for $600 million plus the assumption by Marvell of certain liabilities.

SAC Capital
13G Filings (CY and PPCO)
SAC Capital revealed in two 13G filings today that it has raised its stake in Cypress Semiconductor Corporation (NYSE:CY) to 5.4% and Penwest Pharmaceuticals Co. (NDAQ:PPCO) to 6.2%. CY and PPCO are both undervalued companies that may be of interest for value investors, especially with this fund purchasing.

Yahoo Inc. (NDAQ:YHOO)
8K Filing by the Company
Yahoo announced Q3 EPS of $0.11, which was in-line with estimates. The company also revealed a $3 billion share buyback program over the next five years. The company's share price has been falling recently after failing to effectively compete with Google in the online advertising market. Moreover, the acquisition of YouTube only puts Yahoo further behind in the eyes of many investors.

Glenn H. Nussdorf revealed today in a 13D/A filing that he intends to explore the possibility of acquiring Parlux Fragrances Inc. (NDAQ:PARL) through a business combination. Shares of PARL moved up over 12% on the news to settle at $7.14. According to the filing:

"Mr. Nussdorf has begun to explore the possibility of making an acquisition proposal to acquire the Company in a business combination transaction. As part of such exploration, Mr. Nussdorf and/or his representatives have had preliminary discussions with the Company's management and have had preliminary discussions with potential financing sources to obtain the funds necessary for such a transaction. Mr. Nussdorf has made no decision at this time as to whether to pursue an acquisition proposal and no assurances can be given as to whether or not Mr. Nussdorf will submit such a proposal to the Company. In addition, if Mr. Nussdorf submits such a proposal, there can be no assurances as to whether it would be acceptable to the Company or whether any such proposal would result in a definitive agreement being executed." (Read More)

We first brought up the possibility of this buyout back in July, when Nussdorf first acquired 5% of the company and sought permission to purchase an additional 15%. Now, just about a month later, Nussdorf owns approximately 10.6% of the company and is still buying. It is likely that Nussdorf will use E Com Ventures, Inc. (NDAQ:ECMV) as a vehicle to purchase Parlux, as it is one of Parlux's largest customers. PARL remains undervalued and any buyout would likely come at a premium to the current price, so this is a stock that is definitely worth keeping an eye on as the situation progresses.

Related Companies
E Com Ventures, Inc. (ECMV)
Avon Products, Inc. (AVP)
Inter Parfums, Inc. (IPAR)

Lear Corporation (NYSE:LEA) disclosed in an 8-K filing with the SEC today that billionaire investor Carl Icahn had purchased $200 million worth of shares in a private placement deal with the company. The deal comes as the company has been facing problems executing its restructing plans in an effort to improve their fundamentals. Investors applauded the help, as the stock rose nearly 15% in intaday trading.

According to the filing:

"On October 17, 2006, Lear Corporation ('Lear') entered into a Stock Purchase Agreement (the 'Purchase Agreement') with Icahn Partners LP, Icahn Partners Master Fund LP and Koala Holding LLC (collectively, the 'Icahn Stockholders') pursuant to which Lear agreed to issue and sell to the Icahn Stockholders 8,695,653 shares of Lear’s common stock (the 'Common Stock') at a price per share of $23.00, for an aggregate purchase price of approximately $200,000,000 (the 'Offering'). Certain of the Icahn Stockholders are current stockholders of Lear."

Carl Icahn is well known for his activist approach to enforcing change within companies - most recently ImClone Systems (IMCL). Although investors clearly welcome his help, analysts remain divided with some calling this an opportunity to "aggressively" sell any open positions. Lear's stock is down from over $60 per share in 2004 to its current levels around $25 per share. Although undervalued as an asset play, the company is strugging with declining margins and a weak backlog. If Icahn can help the company successfully execute its restructuring, it could add a lot of value to this stock. It is definitely one worth watching.

Related Companies
Visteon Corporation (VC)
Johnson Controls, Inc. (JCI)
Alcoa, Inc. (AA)

Stock exchanges moved higher today on news that Chicago Merchantile Exchange Holdings (NYSE:CME) was buying CBOT Holdings, Inc. (NYSE:BOT) in a bid to create a combined $25 billion global derivatives exchange. This acquisition follows the bidding war between NASDAQ and the NYSE for the London Stock Exchange, which eventually failed after the LSE rejected the bids in favor of a buyout by Ameripri