Re: the puts. How do you know they were "bought"? They could have been "sold", as in sold short. This would be a bullish move, to capture a fair amount of premium, with little risk.
Of course the risk is that ALA stock goes down, and takes NN with it. In which case, if the transaction isn't covered (buy the puts back), then the guy would have to take delivery of 89500 shares of NN stock at 30.
He may then be able to turn this into ALA stock, if he holds this stock, at whatever price the transaction finally takes place at.
I'd say its more likely that this guys sold these puts short, rather than buying them. Buying 30 strike puts at this point is a bet that ALA stock will be tanking soon, or the deal is falling through. Neither of which seems likely to me. Although, I'm always the last to know. :)
Gary |
