Friday, July 31, 2009

Sold Legacy Reserves LP

Well, I’m back from vacation and decided to take some profits in Legacy Reserves LP (Ticker: LGCY), an oil / gas limited partnership. I entered into this risk arb trade wayyy back in April right after Apollo Management offered to take the company private for $14 per share (unit). I picked up some shares at that time for ~ $13. I sold a few shares yesterday and the remaining today for a total return (including dividends) of 17.72%. I didn’t want to get greedy and in fact I lucked out a bit in this trade as the company rejected Apollo Management’s offer in June.

I've also continued to add to my Sun Microsystems (Ticker: JAVA) risk arb play. Like I said before, this is a very solid deal with minimal anti trust concerns. Oracle has stated that they plan to close this deal by the end of August. This is starting to look a bit aggressive and a more realistic closing is probably sometime in September. In any event, a closing in September still represents a decent return for an arb play.


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