Yesterday was a bad day for the investors in the Bass Pro Shop Cabela’s merger; Cabela’s stock was down as much as 7% from its previous day close, over concerns that closing of the deal will drag on.
Investors in the Bass Pro Shop Cabela’s merger must have been disappointed when they looked at their Cabela’s shares yesterday. Trading at US$58.55/share by the end of the day, the stock is now almost 12% below the price agreed upon in the merger agreement. Continue reading “Bass Pro Shop Cabela’s Merger: Perfect Storm”
The last few weeks have been rich in market action. Looking back to some of the trades and updating the portfolio page.
On November 8th, I bought Accuride Corporation (NYSE:ACW) in the depth of the stock market drop that followed the result of the US presidential election. I had noticed that the only milestone missing for the completion of the private equity buyout by Crestview Partners was a shareholder vote on November 15th, which I did not see as an issue. I got in at US$2.42/share, and the deal was completed on November 18th for US$2.58/share, or 10 days after my initial investment. This must be one of my best trades of 2016. I looked to add to my position, but the price went up too fast when markets convinced themselves that a Trump presidency will be good for the economy. Return: 6.6% over 10 days; annualized return: 241%. Continue reading “Portfolio Update Dec. 17”
With a flurry of transactions announced over the last few weeks, I’m initiating a position in the Bass Pro Cabela’s merger. But first, an overview of the recent news and a quick portfolio update.
Just as America is about to elect its next president, companies have rushed to announce their merger plans, in a move that departs with other election years. I will cover these first before giving some updates on the portfolio and give a few reasons why I initiated a position in the Bass Pro Cabela’s merger.
But first, the latest M&A activity. Continue reading “Bass Pro Cabela’s Merger, News And Portfolio”
The arbitrage of the eFuture Holding transaction should reward investors jumping on while the current spread exists
As promised last week, I’m back at the trading station with a deal for arbitrage-hungry fellow readers to invest in. Without any more teasing, here is the latest opportunity I’ve just put money into. Continue reading “eFuture Holding: Initiating A Stake”
The markets never sleep, and while I was away on a (well deserved!) trip, a few things worth mentioning happened in the M&A space
Summer.. always a good time to be checked out of the financial world. But that I’m taking a break doesn’t mean nothing is happening, and before publishing about a new deal hopefully early next week, I want to quickly review what’s happened recently in our little merger arbitrage business now that I’m back from vacation. Continue reading “Back From Vacation: What Happened Since I Left?”
On March 16, 2016, Coherent (NASDAQ: COHR) annouced that it was acquiring Rofin-Sinar (NASDAQ: RSTI) for US$32.50/share. Now in the last finish line, the deal seems like a relatively easy win.
The transaction had a few milestones to hit on the road map, including shareholder vote and some regulatory approvals. Now that the vote has taken place and Coherent received clearance from the US regulator to acquire Rofin-Sinar, the only thing left to do is getting approval from the European Commission. Continue reading “Coherent/Rofin: One Last Small Regulatory Approval”
With a spread still around 2% and only a few weeks to go until the transaction closes, the profile of the transaction has improved, hence warranting an investment
The first time I looked at the Microsoft/LinkedIn transaction (here) 2 months ago, I concluded that it was not worth my time because the return on investment was too low. Continue reading “Microsoft Buys Linkedin Part. 2: I Went Long”
On August 1, 2016, Tesla (NASDAQ: TSLA) announced that it had reached a definitive agreement with SolarCity (NASDAQ: SCTY), approved and recommended by the Boards of the two companies. Since the talks between the two companies were made public in June, lots have been said about this unusual situation.
So it’s happening. Elon Musk is buying Elon Musk. Or at least to some extent, since the entrepreneur owns roughly 20% of each company and is CEO of Tesla, Chairman of SolarCity. There has been so much said on this deal over the past couple of months that I will only focus on the points that I think are the most relevant: does it make sense for shareholders, should it go through, and will I put my money in it. The answer to the 2 first questions is yes, the one to the last is no, and here is why.
Continue reading “Tesla Buys SolarCity: Bailout Or The Future Of Energy?”
Two deals part of the portfolio, Anthem/Cigna and AbInBev/SABMiller, have been making the headlines in recent weeks. Re-visiting those two opportunities and updating my views.
Two of the 5 pending deals in the portfolio date from before the the existence of this blog. Just seizing the opportunity of the recent press coverage to briefly go over them again as well as provide an update on my strategy.
Continue reading “Mega Deals In The Spotlight”
On June 2, 2016, the First Marblehead Corporation (NYSE:FMD) entered into an agreement to be acquired by two companies controlled by John Carter Risley, a Canadian businessman with investments in fisheries, food supplements, and communications. Investors can buy into FMD now and make an annualized 17% return by the end of the summer.
Why? As always, it’s all about betting on the safest horses. In a diversified portfolio, M&A arbitrage holds the role of an investment which has the volatility of a bond, while offering the annualized return of a stock. Of course, that is assuming that the transaction does not get voted down by shareholders or blocked by regulators for say, antitrust concerns. Continue reading “Why I Just Bought First Marblehead’s Stock”