Bought Virgin America Again
I was premature in selling Virgin America (Ticker: VA) yesterday. After I sold news filtered out that there was a settlement in place with Alaska Air (Ticker: ALK) and the DOJ. Alaska Air is now working to resolve the Alioto ambulance chaser lawsuit. This merger arb play still presents a very nice risk reward opportunity. I re-entered my position this morning at an average price of $55.91. I’m still modeling a close by the end of November.
posted by Money Turtle @ 11:20 AM
38 comments
38 Comments:
Have you been reexamining any of the old ones?
WGBS is projecting a buyout price of between $1 and $1.1409. They scheduled another meeting for November 15th to get a majority approval.
ALR went down again recently, do you think the deal is off?
Yes, I've been keeping an eye on WGBS. If they get the vote, I would likely get back in.
Staying away for Alere... So much issues popping up for Alere. Maybe Abbott does have a case to get out.
I will guess that if they get the vote the stock price will pop.
even if Alere prevails its a long lawsuit..VA will go through its just a matter of time..guys any concerns on trump victory?
STZ caught a nasty downgrade from BOA down almost 10 now.
STZ: Will definitely be some uncertainty in the near term, but I believe this will be fine once the dust settles. Looking to add to my position...
is it a good time to add more STZ?
Are you adding more to VA also?
thanks
I sold some 150 puts on STZ yesterday and wouldn't mind if I got assigned. You should check out the STZ investor conference that was held yesterday. Very solid growth going forward... Short term jitters, but you just have to look through that and focus on the long term growth.
I have a full position in VA so really can't add any more right now.
what do you think of BRCD AGGO deal? any risk about antitrust?
they got the bridge loan already, so everything is ok. Estimated close april.
Will you play BRCD? spread today was near 5% at some point.
Let us know. thanks
MT, if in a merger a stock is bought at 19 let's say, but there are only the strikes of the put at 17.5 and 20.00 can I short the put 20? but what happen exactly when the merger is completed? I will just receive the premium or they will assign me the shares and I will pay the interests for some days? it's unclear to me what to do on a stock where the yeld is too low at the lower strike and the unique is to short the strike in the money.
Scenario: Stock being bought out @ $19 and you sell the $20 Puts. When the deal closes, you're $20 Puts will be assigned since those will be in the money. Assuming cash settlement with accelerated expiration, you will have to pay $20 (i.e. 1 contract $20 short put = $2000 at closing).
Won't the answer be $100. If u get $130 credit and then you are assigned $100, and you keep 30 dollars.
Aapltrader
I explain better
The puts 17.5 have just 0.10 premium
while the 20 have let's say 1.20 so minus 1.00 loss, it's 0.20 profit.
So I can get more cents. But, is there any risk to sell the strike in the money? Like I will pay more interests because of the stock that get assigned? or will be settled all in the same day and so doesn't matter. I mean, the strike 20 can cause me some more cents of cost due to interests if the stocks are considered like assigned?
BRCD deal?
Something to think about is the fees charged by your brokerage for assignments. Some charge and some don't.
Aapltrader - Yes, you are correct!
DC Francis - You're right about the fees for the assignment of in the money options. It really depends on the broker. If it's out of the money, you obviously don't have to worry about fees.
Why did V and Ma go down today? Thank you.
Anonymous, because stocks go up and down. You're welcome
You can't really go wrong with that stock.
Hi MT,
WGBS got shareholder approval. Do you have any updated opinion on this? Based on company guidance it will likely go for over $1. That would be a > 10% in a few months.
Also, are you still heavy in VA? Its been drifting downwards.
Your insights are always appreciated.
WGBS: I initiated a position yesterday. I like this risk / reward here...
VA: Yes, still my largest position and should close soon.
CVT got approval.. nice r/r
Anyone has access to this article from CFTN
"Alioto Begins Depositions in Private Suit Against Virgin America/Alaska Air Merge"
Was published today, looks like DOJ approved but the lawsuit is pending the merger
Thanks
Hi. MT. The tender offer of NXTI is that expiring in Feb. 2017. Thanks.
Previous comment should be NXPI.
NXPI tender is going to be extended well beyond Feb. 2017.
when close LXK deal? SAFE was ok. Now?
LNKD close? if they approve 6DEC in how many days will be completed the deal, I need to consider for my options, there is a good chance will be delisted for the DEC options expiration?
LXK: Should be done soon. Need to check check out the merger agreement for the details.
LNKD: I expect this to close prior to the Dec. option expiration.
ok perfect so IM offer very good yeld now. Just needed SAFE... almost done... and funds hold more IM than LXK.
no luck this year. I'm into IM. Can somebody ready the news about China and give me an idea how risky can be, or if IM will pass... the scrutiny?
Interesting, NXPI was tendered at 110 in one of my accounts but not others
Hi DCFrancis,
Did you actually get paid $110 already? I was under the impression that shares tendered won't actually get bought until the merger is complete. It would be helpful to know how the tender works.
Thanks
In the one account that took place, the "History" tab shows:
VOLUNTARY - TENDER OFFER (N65990017)
and NXPI is gone from the active portfolio.
Hi DCFrancis,
After tendering shares, some brokers replace the actual symbol with a code to prevent you from selling the shares. This does not mean you will necessarily be paid for the shares. Only after the cash hits your account and the position is completely eliminated will you know the transaction is complete.
Lots of noise coming from China regarding currency outflows. My guess is that IM should make it through, but may take some time to convert the cash.
NXPI will take ~ 9 months or so to close. A large deal, lots of regulatory approvals needed.
forgetting hard deals, leveraged, china.. etc etc
what remain? I see as quality HAR, MENT, BRCD, do you agree? forget about spreads, I mean about quality with high probability to complete without troubles, china etc etc, what you would eliminate in this 3 list (LNKD almost done) and/or add as quality/safe merger?
dealreporter says that IM passed SAFE... deal close monday 5 probabily, so it's 0.75% yeld now for 1 day. May be a good opportunity
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