China Ming Yang Wind Power: Potential 55% Annualized Return

On Feb. 3, 2016, China Ming Yang Wind Power (NYSE: MY) announced it had entered into a definitive merger agreement for a going private transaction led by a consortium of investors, including the company’s Chairman and CEO, Mr. Zhang. With little in the way of the transaction closing around mid-June and ~4% of price upside remaining, investors should consider picking up a few shares for what should be a smooth ride.

Going private transactions are often the best arbitrage opportunities, since the antitrust reviews are usually not a concern (the impact of those transactions on a company’s pricing power is limited). What’s more, when the deal is put together by a bunch of insiders with significant control, the chances of it going through are high, especially if no alternative transaction has emerged. China Ming Yang Wind Power displays all the attributes of an attractive merger arbitrage opportunity that is being largely ignored because of the limited liquidity in the stock. However, for the average retail investor, there are more than enough shares changing hands daily to realize a ~55% annualized return, and below are reasons why investors should go ahead. Continue reading “China Ming Yang Wind Power: Potential 55% Annualized Return”

Baxalta Shire Merger: Attractive Spread

Baxalta Shire merger: On Jan. 11, 2016, Shire (NASDAQ: SHPG) made the headlines of the pharma news when it announced that it had agreed to buy Baxalta (NYSE: BXLT) for US$32bn in a cash and stock transaction. The spread sits currently at ~7% and below are the key reasons why the outcome should be favorable (i.e. the deal closing)

Continue reading “Baxalta Shire Merger: Attractive Spread”