New Arb Plays

Sometimes you just have to be lucky… I recently put on a fairly large arb position on Greenfield Survey (Ticker: SRVY), which has agreed to be acquired by Quadrangle for $15.50 per share. I purchased a bunch of Greenfield around $14.60 and subsequently watched the stock go down and down. My first inclination was that the deal was falling apart, but there was not a hint of anything wrong in the SEC filings. So I decided to hang on and wait it out. Well, today the stock shot up 20% because the company received another buyout offer for $17.50. There are a lot of inefficient pricing in the merger plays out there. A few arb focused hedge funds have blown up and are no longer in the game. You can find some nice returns on arb plays if you do your homework. I’m currently in Greenfield Survey, SAFECO (Ticker: SAF), Choicepoint (Ticker: CPS) and CHC Helicopter (Ticker: FLI). I was in Apria Healthcare Group (Ticker: AHG), but got out when they delayed their earnings report due to accounting issues. I may jump back into Apria Healthcare after the earnings report.