Under the deal, RehabCare stockholders will receive $26 in cash and 0.471 Kindred shares for each of their shares. Kindred plans to issue about 12 million shares in connection with the transaction. The deal also includes the assumption of about $400 million in debt.

That will award Rehab shareholders a 37.4% premium to the company’s closing share price on Monday of $25.47. Rehab shares have traded as high as $31.93 and as low as $15.88 over the past year. Kindred will receive financing from J.P. Morgan Chase, Morgan Stanley and Citigroup Inc. and also assume $400 million in RehabCare debt.

The deal will create the largest “post-acute” health company in the country, with more than $6 billion in revenue and operations in 46 states.

RehabCare posted fourth-quarter earnings of $17.1 million, or 69 cents a share, up from $655,000 or 3 cents a share, a year earlier. The year-earlier period included $7.2 million in charges related to its 2009 acquisition of Triumph Healthcare. Revenue jumped 36% to $339.3 million. Analysts had predicted a per-share profit of 61 cents on $344 million in revenue.

Nelson Peltz disclosed he’s offering to buy discount retailer Family Dollar Stores for $55 to $60 a share in cash.

Peltz said last year that he believed Family Dollar’s shares were undervalued, and he said he would discuss with the company ways to improve operating performance.

Family Dollar shares ended the regular trading session at $43.96 a share.

At $60 a share, a buyout would cost Peltz $7.6 billion, based on Family Dollar’s recent share count of 126.4 million shares.

Peltz said in a regulatory filing that he also offered Howard Levine, the Family Dollar CEO, an opportunity to participate in a company buyout.

Peltz’s investment firm, Trian, “also advised Mr. Levine that in their view, the ultimate decision of whether the Issuer should be sold should be determined by the Issuer’s shareholders,” according to the regulatory filing.

Trian owns nearly 8% of Family Dollar’s shares, according to today’s SEC filing.

Sanofi is paying $74 a share, or $20.1 billion, plus a contingent value right, or CVR—a pledge of additional payment of up to $14 a share if Genzyme meets certain sales and manufacturing targets. Genzyme shareholders will get extra money if Lemtrada, Genzyme’s experimental treatment for multiple sclerosis, makes it to market and achieves certain sales. Shareholders will receive additional money if Genzyme restores manufacturing to certain levels at the plant that has experienced problems.

Acquiring Genzyme gives Sanofi its own dedicated research team in the U.S., and better links to other U.S. research partners in academia and the biotech industry, Mr. Viehbacher said Wednesday.

“Although the opportunities [for research collaborations] are global, it is still true today that the most numerous opportunities are in the U.S.,” he said during a webcast with shareholders held at Genzyme headquarters. “To work collaboratively we felt we really needed to have a stronger presence here in the U.S., particularly on the research side.”

Genzyme also gives Sanofi more know-how in biological drugs, which are proteins made in living cells. Biological drugs have been among the most effective treatments discovered in recent years, making it crucial for companies to have expertise in the area.

The deal was announced as Genzyme said its fourth-quarter earnings surged as the company continues to recover from manufacturing problems that temporarily shut down its main production site in 2009. The plant is the sole source of Genzyme’s top-selling products, Gaucher’s disease treatment Cerezyme and the Fabry disease drug Fabrazyme, which are recovering from shortages that stemmed from the shutdown. In the quarter, Cerezyme sales more than doubled on increased shipments, while Fabrazyme sales were up 6.2% as supplies improved. Genzyme reported a profit of $471.9 million, or $1.76 a share, up from $23.2 million, or 9 cents a share, a year earlier.

Sanofi said Genzyme will keep its name and operate as a separate unit focused on rare diseases, an area Genzyme has specialized in. Mr. Viehbacher said he planned to “keep the identity of the company, keep everyone in the company but still achieve some synergies.”

A joint integration steering committee will be co-chaired by Mr. Viehbacher and Henri Termeer, who will resign as chairman and chief executive of Genzyme when the transaction is completed.

Sanofi for years was staunchly French, focusing much of its drug research in its home country. But since Chris Viehbacher took over as chief executive in 2009, the company has been widening its research net in an effort to improve its drug development. Mr. Viehbacher, a citizen of Canada and Germany, has struck more research partnerships with outside academic groups and biotech companies, and in December hired a new head of R&D—Elias Zerhouni, the former director of the U.S. National Institutes of Health.

Lake Shore Gold (TSX: LSG), a Canadian junior gold company (JGC), is no longer on our watch list. We originally liked Lake Shore Gold for its position as a takeover target. However, Hochschild Mining plc (a mid tier gold producer listed on the London Stock Exchange) has reduced their stake in the company.

Hochschild originally owned 36% of the company, but on Thursday, Oct 14th 2010, it reduced it’s stake to 5.7%, offloading more than $392 million in common stock. Lake Shore Gold has fallen approximately 4.6% to $3.53 since Hoschild’s announcement and we believe LSG will continue to fall due to the elimination of any takeover premium.

Lake Shore Gold is a rapidly growing mining company, aiming to become one of North America’s mid-tier gold producer through successful exploration, development, and operation of three wholly owned mines in Timmins, Ontario. The company plans to grow from 65,000 oz of gold in 2010 to mid tier levels of 350,000 oz of gold in 2013. Lake Shore plans to achieve its growth through the acquisition and development of high-grade gold projects within the Canadian Shield.

Lake Shore is still doing well, but some ratios seem rich when compared to competitors, as well as the industry in general. Lake Shore Gold’s estimated EBITDA for 2011 is 10.6 which almost double the average of 5.5 for other junior gold companies. Likewise, the company’s P/E ratio of 18.2 for 2011 is higher than the sector average of 12.3.

We will continue to have our eye on Lake Shore Gold, but for now, we no longer consider this stock a ‘Good Buy’ opportunity.