Acquisitions Benefit Intel (INTC), Yamana Gold (AUY)

Wyatt Investment Research

Intel (INTC) and Yamana Gold (AUY) each completed sizable acquisitions today. And the deals have given both stocks a nice kick in the pants.

Yamana shares have climbed 2% after the gold mining company’s $404 million acquisition of Vancouver-based gold miner Extorre Gold Mines (XG). The deal gives Yamana – the third-largest gold producer in Canada – control of Extrorre’s coveted Argentina gold and silver mines. With Extorre’s stock getting pummeled this year – entering the day, shares were barely one-quarter of what they were worth in late January – Yamana pounced at the opportunity to buy the company while it’s cheap.

Intel made a similar-sized investment with its $375 million acquisition of InterDigital (IDCC) – or at least of its 1,700 patents. Many of the patents involve wireless technology, and will help Intel expand further into the mobile market by broadening its product offerings.

Intel’s stock didn’t get the same boost (0.5%) Yamana did after its deal. But the patents should help the company down the road.

The real beneficiaries from the acquisitions were, of course, the companies that suddenly find themselves swimming in an extra $350 million-plus worth of cash. Extorre jumped 56% on after Yamana’s acquisition. InterDigital jumped 27% on its patent deal with Intel.



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