Bought MRV Communications, Inc.
I initiated a position (~7.4% position) in MRV Communications, Inc. (Ticker: MRVC) at $9.95. MRV Communications is being acquired by a German company, ADVA Optical Networking SE for $10.00 in cash. This deal is being structured as tender offer with the tender expiring on 08/11/17. I am modeling that this deal closes on 08/11/17 with the cash hitting the account by 08/18/17. This would generate a net gain of 0.50% (~10.6% annualized return).
posted by Money Turtle @ 11:52 AM
26 comments
26 Comments:
nice little snack!
Yes, I'll take a bunch of the little snacks!
MT,
I am curious what your brokerage charges you if anything to have your shares liquidated for cash after the tender has closed and is processed.
Regards,
inforesource7
from the yahoo message boards years and years ago
My broker does not charge any fees for participating in a tender offer.
MT,
I checked with my broker and no charge for tender offers for me either. I assume you have a commission to buy the shares you plan to tender. If so do you factor that in to your returns? I have never tendered shares before and you have been through many tender offers. Without going into great detail,
Once you commit to tendering your shares, what happens if you change your mind? Is there flexibility to uncommit so to speak? Some of these tender offers get extend multiple times (ie. NXPI). Are the tender share count results reported along the way and if so where does one learn the numbers from? What happens to call and put options in the money at the end of the tendering process?
I find whats playing out with NXPI and Elliot taking a large stake fascinating. Back in January many of us thought Qualcom's offer was a steal. Looks like Elliot had a plan all along to try and make them pay more. The small Shareholders have a advantage this time. The big hurdle is the foreign regs. approval process.
Thoughts on NXPI?
Regards,
Inforesource7
Infosource7: I do factor in commission in determining the total return. Commission rates are so low these days, it's almost negligible.
You can usually withdraw the shares you have tendered if for some reason you change your mind. It may take a couple of days for the tendered shares to return to your account. Companies usually report the number of shares tendered when there is an extension of the tender offer or at the close of the tender offer. There is no running tally of the number of shares tendered as that is closely held info by the company.
The expiration of options will be accelerated based on the anticipated closing of the deal. The expiration of the options will be cash settlement.
NXPI: Looks like Qualcomm will be forced to bump the price. If shareholders reject the deal, NXPI should hold up fairly well.
when MBLY cash will hit my account? tender succefull 7 august but still I don't see the money
MBLY: I would check with your broker. They have an estimated date (swing date) of when the funds will hit your account.
the cash didnt hit my account today.. will it monday?
MRVC: I received the cash yesterday (8/17).
is it because you tendered your shares? i have fidelity and don't see the money yet.
p.s reCAPTCHA is very annoying
Yes, I tendered my MRVC shares. You will generally receive the cash quicker when you tender.
MT,
Has anybody been following the INTC tender offer process for MBLY? After the initial tender completed and the subsequent tender was completed (combined total 97.3% of outstanding shares), 2.7% of outstanding shares are hanging out their in the balance at a discount price. MBLY moving ahead to delist and deregistered ordinary shares. My $64,000 question is what happens to untendered 2.7% outstanding shares? Are the stock holders $ hit out of luck?
Infosource7
MBLY: I haven't followed this tender, but I would imagine that there will be a squeeze-out for the non tendered shares.
what are you thoughts on COL? maybe buy stock and sell 140c?
Anonymous,
UTX / COL deal most likely will be a cash and stock combination cash deal. Various media mention $140, $145 or $150. Before todays news update and stock price spike the options IV's were fairly high and selling calls against stock were very enticing. IV's have deflated now so this approach is much more challenging (less greedy/profitable). One could buy stock and potentially earn stock price gains the next 2-3 days and then sell premium on $140 call at higher price (so 2 legs) or consider selling premium on $135 calls (higher) but sacrifice strike spread. Due to cash and stock deal holding covered calls (farther out) you loose control which is a drag. There is room for creativity here. This is only one mans stream of consciousness on risk arbitrage.
Regards,
Inforesource7
COL: I initiated a ~ 9.5% position today. Just bought the common.
MT,
I am surprised you do not use disaster insurance (Put protection) as a conservative investor/trader. Yes, we know it reduces potential upside profits.
By the way my COL position is 19% taken weeks ago. Please do not take my position size as any influence on others decisions. Each investor/trader works with a different risk profile.
Maybe we could have some healthy dialogue here to discuss various approaches of protection. We are all just minnows in a big sea of whales (stock market).
Regards,
Inforesource7
I am long jan 130/135call spread and short jan 140c too. I think the stock will trade around 135 for some time, since the deal might not close for six months.
Were you on yahoo message board regarding MDVN Infosource7?
Anonymous,
I am long common stock and hold 125 put protection in case of any potential disaster (busted deal). I may consider short calls 135/140 Sep/Oct depending if stock price moves up the next two days. With all due respect this potential deal will not linger for 6 months. Long weekends have some history of giving birth to some large deals. Both sides have an extra day to hammer out the final details and produce the famous Definitive Agreement. This deal will not linger for 6 months. Any cash / UTX stock combination will keep the COL stock price in check and impact the post announcement stock price response. We prefer call options to end up in the money or expire worthless near term. Rolling back longer term or leaps can be a pain. Everything is fluid.
I do not believe I ever was involved with MDVN. I remember WSJ, BJ (BJ's Wholesale), BIG (Big Lots) to name a few. I remember Lind and Bullwinkle who hung out alot on the HUN message board.
Regards,
Inforesource7
Anonymous,
Just to clarify, I hold SEP 125 Put protection.
Regards,
Inforesource7
All,
UTX / COL deal could be unique in that a Reverse Morris Trust maybe be used in this transaction. This may be why the COL and UTX stock prices are behaving modestly at this point. Here are a couple of links to help you learn about it. MT might recall any past deals that took advantage of a Reverse Morris Trust.
https://www.macabacus.com/strategies/morris-trust
http://www.barrons.com/articles/united-technologies-a-buy-and-a-breakup-1504203080?mod=yahoobarrons&ru=yahoo&yptr=yahoo
Regards,
Inforesource7
All is good as long as next tuesday announcemt is betwenn 135 and 140 all cash offer. Originally the offer was rumored to little less than 140 and now still less than 140, maybe COL taking all cash deal for a little discount maybe..
good luck to all
I've participated in a few Reverse Morris Trust spin out plays, but not a M&A play. A Reverse Morris Trust would make sense with this deal.
Also playing Kite Pharma via short Puts. This deal should close quick (early / mid October close).
MT,
Since Pharma/ Med deals are your forte (sp?) I guess we are not surprised you sniffed out this play on KITE. WE love fast closings like (ie. AMZN / WFM). Since the deal announcement the KITE stock price is literally flat line. Are you shorting naked Puts or using a Put credit spread? Which series (month) and strike did you decide on?
Regards,
Inforesource7
KITE: I'm shorting (naked) the long dated Puts: January 2018 / 2019 with the $170 / $175 strikes.
Post a Comment
<< Home