The Sikorsky helicopter unit of diversified U.S. manufacturer United Technologies Corp is on the hunt for acquisitions of smaller companies that maintain aircraft – a business that can offer a higher profit margin than selling them, a top executive said on Friday.

“In the aerospace services area, I think there’s a huge MRO (maintenance, repair and overhaul) market out there that could be consolidated,” Jeff Pino, Sikorsky’s president told investors in New York, where United Tech was providing an update on its 2010 outlook.

While his words caught analysts’ attention, they suggested a smaller-scale approach to takeovers than the company had in mind last year, when it entertained questions about trying to buy the Bell helicopter unit of rival Textron Inc, which was coping with a plummeting stock price in the face of a market rout.

That deal never occurred – and Providence, Rhode Island-based Textron has seen its shares surge about fourfold over the past year, easing pressure.

Investors did not specifically ask Pino about the Bell question, and he gave no sign of thinking about the one that got away.

“It’s clear that large scale consolidation is just not happening,” Pino said.

(Acquisitions Monthly) The job lot sold to BP by Oklahoma-based oil company Devon Energy, as part of its deep water disposal program, includes a ticket for BP into Brazil’s ultra-deepwater oilfields, likened in potential size to the next North Sea, but still very much an unknown quantity.

“Exciting”, is how Tony Hayward, BP group chief executive, describes Brazilian deepwater.

Although the transaction with Devon Energy involved other significant assets around the globe – in the Gulf of Mexico, in the Caspian Sea and in the tar sands of Canada – and although the transaction was also a two-way deal involving the US$500m sale by BP to Devon of a 50% stake in its Kirby oil sands interest in Canada (along with the establishment of a joint venture), it is Brazil’s deepwater fields that the deal is about for BP.

Was the cash price of US$7bn fair? That is typically the first question, but attempts to translate the number into the industry’s valuation standard of dollars per barrel (proven or probable) are of little use, given that the full Brazilian upside of the deal for BP has yet to be explored and will not begin to materialise until 2015. The Brazilian assets include 10 exploration blocks, of which seven are in the Campos basin.

Immediate market reaction on March 11, the day of the announcement, suggested that Devon narrowly got the better of the deal, its share pricing rising 1% compared with a corresponding dip in BP’s share price, but eventually BP’s share price closed just 1.2p lower at 623.7p.

But if the Brazilian licences were what BP was really after, then to get them it is a fair chance that a generous deal was done in Canada and a full price paid for the rest of the assets: a portfolio of exploration acreage and prospects in the US Gulf of Mexico, focused on the “emerging Paleogene play in the ultra-deepwater”, and an additional 5.63% stake in the Azeri-Chirag-Gunashli (ACG) development in the Caspian Sea off Azerbaijan, taking BP’s stake there to 39.77%, assuming that other major oil producers do not exercise pre-emption rights over the ACG stake.

By Quentin Carruthers

A look at “Repo 105,” a series of transactions that Lehman Brothers is alleged to have used to make its balance sheet appear stronger.

- Text: Dan Wilchins, llustration: Silvio DaSilva

An overview of the week in M&A, capital markets and syndicated loans — with league tables, up-to-date industry and country trends, as well as top transactions for the past week — from the Deals Intelligence team at Thomson Reuters:

South Korean Offering is Third Largest IPO of the Year

The recently announced $1.6 billion IPO from Korea Life Insurance Co is the largest South Korean IPO of the year and the largest offering from a South Korean company since January 2006. The listing is also the third largest global IPO in 2010. Year-to-date, IPOs in South Korea total nearly $1.9 billion from 13 issues, up nearly seven times from the same time last year.  This IPO bolsters South Korea’s ranking in the global IPO market, accounting for 8% of total proceeds this year.

MetLife Announces Largest Acquisition on Record

US-based MetLife Inc’s $15.5 billion announced acquisition of American Life Insurance Co Inc from AIG is the company’s largest acquisition on record. So far this year, insurance M&A activity in the United States totals $18.7 billion, just over 11% of total United States M&A.  Overall, M&A transactions in the United States are up 12% from the same time last year and deals in the global insurance industry are up over six times compared to 2009.

Securitizations Boost Global Debt Markets

With year-to-date securitized issuance up nearly three-fold so far in 2010, mortgage and asset-backed securities account for 12.1% of overall activity this year, compared to 2.6% for year-to-date 2009. Overall activity in the global debt markets is down 15% from the same time last year. With a nearly $1.1 billion mortgage-backed offering from UK-based Fosse Master Issuer Plc, securitized issuance is up over 500% in Europe from the same period last year.

Lehman Brothers Holdings Inc used accountancy gimmicks and had been insolvent for weeks before it filed for bankruptcy in September 2008, a court-appointed examiner has found. The good news is, but there was not extensive wrongdoing.  Read the Reuters story here.

Norway’s Yara International said on Friday it would not raise its offer for Terra Industries to match or exceed a rival bid from CF Industries Holdings Inc, Reuters reported. Yara agreed last month to buy Terra for $4.1 billion to create the world’s biggest mineral fertiliser producer.

And in news from other media on Friday:

Buyout firm Advent International has appointed advisors to assess a possible sale of budget store chain Poundland, the Financial Times said. The group has hired Close Brothers to look at options.

The court-appointed examiner who investigated the collapse of U.S. investment bank Lehman Brothers Holding Co made his report public after a judge ruled he could do so on Thursday. Here are some highlights from the report, which is available here. A full story will follow shortly:

* Examiner says “business decisions that brought Lehman to its crisis… may have been in error but were largely within the business judgment rule”

* Examiner says a limited amount of assets of (Lehman affiliates) were “improperly transferred” to Barclays PLC

* Examiner says there may be “colorable claims” against senior officers ” who oversaw and certified misleading financial statements”, naming Fuld, O’Meara, Callan and Lowitt

* Examiner says there may be “colorable claims” against Ernst & Young and senior officers for failure to meet professional standards in connection with lack of disclosure

* Examiner says “Lehman’s valuation procedures may have been wanting and that certain valuations may have been unreasonable”

* Examiner says there is sufficient evidence to support that Lehman was insolvent on beginning on September 2, 2008

* Examiner says Lehman’s “small margin of equity relative to assets meant it did not need much loss of asset value to render it insolvent”

* Examiner says “a colorable claim is one for which there is sufficient credible evidence to support a finding by a trier of fact”

* Examiner says Lehman employed certain repo transactions for sole purpose of “balance sheet manipulation”

* Examiner says JPMorgan Chase & Co is still holding about $6.9 billion of Lehman collateral

* Examiner says Lehman may have a “colorable claim” that would let it recover some collateral transfers made to JPMorgan as part of a September guaranty

* Examiner says Lehman may have a “colorable claim” against one clearing bank – JPMorgan – arising from collateral demands in 2008

* Examiner says JPMorgan CEO Dimon told Fuld in every conversation “that he did not want to harm Lehman”

* Examiner says JPMorgan CEO Dimon said had Lehman CEO Fuld called him, JPM would likely not have insisted on collateral because it didn’t want to be blamed for Lehman’s demise

IPOs have been described as a company’s coming-out party but these days it’s more like a “testing the waters” event – which may or may not happen depending on the temperature. Find the latest IPO news below.

CBOE files for $300 million IPO (Reuters)
“The Chicago Board Options Exchange will pay a special dividend of $113 million before the IPO to its current stakeholders, and annual dividends of 20 to 30 percent of prior-year net income to shareholders after the IPO, the company said in filings with the Securities and Exchange Commission.”

Kabel Deutschland IPO – ambitious play or cunning ploy? (Reuters)
“Kabel Deutschland’s premium pricing for its $1 billion IPO could invite a similar fate to other recent failed private equity-led offerings, and some still think it’s a ploy to smoke out trade buyers.”

Samsung Life gets bourse nod for record $4 billion IPO (Reuters)
“Fund managers and analysts are cautious in predicting demand for Samsung Life, ranked 14th among global life insurers in premiums received, but said the IPO would attract developing market-focused funds.”

Sensata Rises on Stock Debut (WSJ)
“If Netherlands-based Sensata Technologies Holding B.V. can hang on to its gains for the entire session, it would be the first time a new stock priced within range and rose on the first day of trading in the U.S. since January.” – WSJ

UK clean tech to try luck in uncertain IPO market (Reuters)
“British companies involved in the waste and energy efficiency sectors are considering flotations to raise funds for growth even as the IPO market remains uncertain.”

Fiat May Need to Convince on Chrysler Before Auto IPO (Bloomberg)
“The Italian company’s stock has risen 21 percent this month on speculation that Chief Executive Officer Sergio Marchionne may carve out Fiat’s biggest unit as a new company.” – Bloomberg

10 Biggest IPO Flops in History (HowStuffWorks)

“If all goes well, investors scramble to buy the freshly minted stock, lifting the price through the roof and making lots of people happy — by which we mean filthy rich — in the process.” – HowStuffWorks

Eyeblaster Eyes an IPO for the Second Time (BloggingStocks)
“True, the economic system has since stabilized. But is the market ready for an Eyeblaster IPO?” -BloggingStocks