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Merger Monday

Published: Monday, 28 Sep 2009 | 9:46 AM ET

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By: Bob Pisani
Reporter

Bob Pisani is off today, this posting was written by CNBC producer Robert Hum.

Propelled by M&A activity and chatter, U.S. stock futures are up modestly this morning despite a sell-off in Asian markets overnight.

Japan’s Nikkei 225, Hong Kong’s Hang Seng, and China’s Shanghai Composite all fell over 2 percent as a weakening U.S. Dollar continued to weigh. The declining Dollar, which hit an 8-month low versus the yen, hurt shares of many Japanese exporters, as investors worried about the currency impact on forthcoming earnings.

As a result of today’s decline, the Nikkei 225 sits at a 2-month low, the Hang Seng Index rests at a 2-week low, and the Shanghai Composite hovers at a 3-week low.

CNBC.com Slideshow - Central Banker Report Cards 2009

Merger Monday Mania

Back in the U.S., M&A news dominates the headlines this morning:

1) Xerox [XRX Loading... () ] announced it will buy IT service provider Affiliated Computer Services [ACS Loading... () ] for $6.4 billion in cash and stock. The deal, which gives Affiliated Computer Services shareholders a nearly 34 percent premium on their shares, will give Xerox greater presence in the outsourcing/IT service industry with its services revenue seen tripling to $10 billion next year.

The merger is expected to close in the first quarter of next year. In pre-market trading, Affiliated Computer Services soars 21 percent, while Xerox falls 9 percent.

2) Abbott Laboratories [ABT Loading... () ] is up 3 percent pre-open after reaching a deal to acquire the pharmaceutical business of Belgian’s Solvay for $6.6 billion in cash. The acquisition will give Abbott full control over cholesterol-fighting drugs TriLipix and Tricor and will provide the drugmaker with an additional $3 billion in revenues worldwide. The deal should close early next year.

3) Dow component Johnson & Johnson [JNJ Loading... () ] revealed it has taken an 18 percent stake in Dutch biotech Crucell for $440 million. The deal creates a partnership that will help research and develop flu vaccines.

4) The U.K.’s Observer newspaper reports that Kraft [KFT Loading... () ] is looking at raising its offer for Cadbury [CBY Loading... () ] in a hostile bid. A new $17.6 billion deal would be about a 5 percent increase from its $16.7 billion cash and stock offer it made earlier this month.