Wednesday, June 22, 2016

China Ming Yang Wind Power Group = Done Deal

China Ming Yang Wind Power Group (Ticker: MY) closed today as expected. There were clear indications since early last week that this deal was going to close today. The company filed with their ADR sponsor for the termination of their ADR program on June 13th. My net gain from this arb play will be 1.58% (annualized gain of ~ 48% assuming the cash hits my account by 6/27). This position comprised of ~ 17% of my portfolio. Now, let’s see when Qihoo 360 (Ticker: QIHU) will close…

Wednesday, June 15, 2016

Bought China Ming Yang Wind Power Group

Yesterday, I initiated a position in China Ming Yang Wind Power Group (Ticker: MY) at $2.42 (~ 14% position). This company is being acquired for $2.46 (after subtracting the $0.05 ADR fee from the buyout price of $2.51). The company recently notified Citibank (their ADR sponsor) that they are terminating the ADR program as of June 23rd (click here), which I expect to be the last trading day. I am modeling that the cash will hit my account by June 27th, which would equate to a net gain of 1.65% (~ 42% annualized return).

Thursday, June 02, 2016

May 2016 Performance

Well, it’s a nice to be finally in the green for the year. A good portion of the positive performance in May can be attributed to the various special situation / merger arb plays. For example, I got lucky with Nanosphere (Ticker: NSPH) in which there was a nice bump in price as another bidder came knocking on the door. In addition to Nanosphere, I am currently in the following special situation / merger arb plays: DreamWorks Animation (Ticker: DWA), Medivation (Ticker: MDVN), Qihoo 360 (Ticker: QIHU), Morgan Hotel Group (Ticker: MHGC), WaferGen Bio-systems (Ticker: WGBS), Krispy Kreme (Ticker: KKD) (short puts) and Cabela's (Ticker: CAB), which I just initiated this afternoon after checking out a write up from the NY Post.

I do not remember a time in which there was so much M&A activity occurring in a single month. In the start of the year, I envisioned that M&A would be subdued for 2016, but I’m glad to be wrong.

Now it’s just watching the grass grow as I wait for these positions to close…

2016 Performance Year to Date = +5.17% with the running monthly returns as follows:

January -5.47%
February -3.50%
March +7.51%
April +0.84%
May +6.34%

Tuesday, May 17, 2016

Bought Nanosphere, Inc.

Today, I picked up some Nanosphere, Inc. (Ticker: NSPH) at $1.31 (~8% position). This company is being acquired by Luminex (Ticker: LMNX) for $1.35 in cash via a tender offer. This deal should close quickly and I have modeled a close by June 30th. I will be looking at a potential net gain of 3.05% (~24% annualized return) if this deal closes by the end of June.

Friday, May 13, 2016

Jiayuan International = Done Deal

It’s nice to see that International (Ticker: DATE) finally closed. I went in big yesterday with an average price of $7.417, which made up ~ 45% of my portfolio. My net gain will be 1.25% (50% annualized gain assuming the cash hits my account on 5/20). I patiently wait for these types of scenarios to develop where the odds are heavily in my favor so I can go “All In”. Now I can focus on some new names and get ready for next week…

Bought WaferGen Bio-systems

I picked up some WaferGen Bio-systems (Ticker: WGBS) today at $0.90 (~ 1.8% position). This company is being acquired by Takara Bio. I’ve never seen this type of deal before in which the final price paid will be based on WaferGen Bio-system’s 2016 revenue. I did a quick back of the envelope calculation and I think the final price can be $1.50+ based on the companies projected 2016 revenue guidance of $12-13 million. Am I missing something? This deal will close in February / March 2017. Almost There... International (Ticker: DATE) filed their annual report (Form 20-F) with the SEC today and in that report it states that “The Group expects the proposed merger to be closed on May 13, 2016.” It looks like today will be the last trading day for This was certainly one wild ride, but the end is finally in sight.

Thursday, May 12, 2016

Bought International

I spent today buying International (Ticker: DATE) (currently ~40%+ position) at an average price of $7.42 (buyout price = $7.51 taking into account of the $0.05 ADR fee). It looks the company is finally scheduled to complete the going private transaction on May 16, 2016. Yesterday, the company filed notice with NASDAQ for the termination of the ADR program effective on May 16, 2016 (click here).

Tuesday, May 10, 2016

A Small Arb Play - Morgan Hotel Group

I picked up small position (~2% of portfolio) in Morgan Hotel Group (Ticker: MHGC) today at $2.10. The hotel chain is being acquired by SBE for $2.25 per share in cash. The company is guiding for a Q3 / Q4 close. Based on that guidance, I would model a close by October (hopefully sooner!). My potential gain would be + 7.14% over a 6 month period (~14.95% annualized return). There is a good possibility that this deal can close sooner than October. The nice arb spread maybe attributed to its small market cap, which is avoided by most of the large arb funds.