U.S. HOT STOCK FUTURES: HOT STOCKS TO WATCH

Among the companies with shares expected to actively trade in Monday's session are Lufkin Industries Inc. (LUFK), Obagi Medical Products Inc. (OMPI) and Constellation Brands Inc. (STZ).

General Electric Co. (GE) confirmed it agreed to buy Lufkin for about $3.3 billion in cash to further expand an oil and gas business that GE has built up via a string of acquisitions in recent years. GE said it will pay $88.50 for each Lufkin share, a 38% premium to Friday's close. Lufkin shares rose 37% to $87.80 premarket.

Merz Pharma Group withdrew its roughly $385 million offer to acquire Obagi Medical, citing Valeant Pharmaceuticals International Inc.'s (VRX, VRX.T) sweetened bid for the specialty pharmaceutical company last week. Valeant last Wednesday boosted its offer for Obagi Medical to $24 a share, increasing the value of the proposed deal to about $420 million from its earlier offer of $345 million. Obagi shares dropped 5.6% to $23.99 premarket.

Anheuser-Busch InBev NV (BUD, ABI.BT) and Mexico's Grupo Modelo SAB (GPMCY, GMODELO.MX) have an "agreement in principle" with the Justice Department to resolve a government antitrust lawsuit that sought to block the two beer makers' proposed merger. AB InBev is seeking to acquire the 50% of Modelo it doesn't already own. The settlement terms include AB InBev offering to sell an additional $2.9 billion of assets to Constellation Brands to rescue the proposed $20.1 billion Modelo takeover. Shares of Constellation rose 2.9% to $49.24 premarket.

Pharmacyclics Inc. (PCYC) said the U.S. Food and Drug Administration granted an additional breakthrough-therapy designation for its investigational oral agent ibrutinib as a monotherapy to treat patients with chronic lymphocytic leukemia or small lymphocytic lymphoma with deletion of the short arm of chromosome 17. Shares rose 5.6% to $79.77 in light premarket trading.

 
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Avon Products Inc. (AVP) will cut its global headcount by more than 400, restructure or close some operations in Europe, Middle East & Africa, and exit the Ireland market, continuing Chief Executive Sheri McCoy's push to cut costs and streamline operations for the door-to-door cosmetics vendor.

Bayer AG (BAYRY, BAYN.XE) said the New Drug Application for its oral investigational compound riociguat has been granted priority review by the U.S. Food and Drug Administration for the treatment of two forms of pulmonary hypertension.

Dell Inc. (DELL) said it is willing to provide activist investor Carl Icahn with the same expense reimbursement that it has offered to its other two bidders, but only if Mr. Icahn drops his threats to pursue a proxy fight and litigation.

Private equity firm MidOcean Partners has withdrawn its bid for Edac Technologies Corp. (EDAC) for undisclosed reasons. Late last month, MidOcean, along with Public Sector Pension Investment Board, made a bid for Edac that valued the aerospace and industrial-components maker at about $105 million, looking to trump an earlier deal made with a private-equity firm.

Standard & Poor's Ratings Services upgraded PNM Resources Inc. (PNM) one notch further into investment-grade territory, noting the utilities company has benefited from more-favorable regulatory relationships in New Mexico and Texas.

Write to Anna Prior at [e-mail]

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