1) Taking out the competition. That's what happened today in two deals: one in real estate, the other in retail:
a) A real estate mega-dealis in the making with Zillow buying Trulia. Trulia shareholders will get .44 shares of Zillow stock. That translates into a share price of $69.96, roughly 25 percent above Friday close. Trulia shareholders will own about 33 percent of the combined company.
What's interesting is how powerful the combined entity would be: the online competition appears to be fairly minimal. True, realtor.com (the official site of the National Association of Realtors, operated by MOVE) is out there, but little else.
Twenty years ago, when I was the Real Estate Correspondent for CNBC, I reported frequently about how the growth of online real estate listings would allow people to sell their own homes and would dramatically cut down Realtor commissions (disclosure: my wife has been a Realtor since the 1980s).
But commissions never did collapse: they are still 5 or 6 percent. There are two reasons for this: first, it is very difficult for most people to sell their homes by themselves, and second; companies like Zillow are not trying to cut out realtors, or reduce their commission. They are doing the opposite: they want more Realtors to pay the roughly $300 a month to advertise on the site.
And that's where the combined Zillow-Trulia company could be a concern: they would most likely raise their prices. Realtors who have stopped advertising in local newspapers and who now depend on online advertising would have few options. Sure many still send out farm letters, but many have stopped advertising in local newspapers.
b) Then discount store chain Dollar Tree is buying rival Family Dollar stores for $74.50 a share in cash and stock. That represents a 23 percent premium to family dollar's close Friday.