Tuesday, November 03, 2015

CFIUS Approval for ISSI and Some Dyax

Integrated Silicon Solution (Ticker: ISSI) finally received CFIUS approval so it’s pretty much smooth sailing to the closing now. I was modeling a close by next week, but the company is now guiding for December close pending regulatory approvals from Taiwan and China. These will be rubber stamp approvals at this point. I may just close out my position as there are many attractive merger arb plays out there right now.

Yesterday, I initiated a position in Dyax (Ticker: DYAX) (~5% position) at $35.57. This company is being acquired by Shire for $37.30 in cash plus a $4.00 CVR. There is a wide spread, which can probably be attributed to (1) a potential material adverse event for a drug still in development, (2) potential acquisition of the acquirer (Shire) and (3) anti-trust concerns. The Street is probably most concerned about anti-trust. With all of these factors, you get a merger arb play with added risks. I have to size this one appropriately given all the potential risks, but I can see myself going to a 10% position at some point.


At November 03, 2015, Anonymous mergerpie said...

It does seemed like Shire is taking over a big chunk of the HAE treatment market with the purchase of Dyax. FDA may take a hard look at the deal. I would hold off investing in the arb trade until 1-2 months later to get a clearer view on the regulatory issues. The $4 CVR is tasty I think the chances are greater than 50%.


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