Thanks for the info. I've run across one other fund, a small cap fund, that specializes in mergers and buyouts, but I can't find it in my files. I checked the top holdings of the fund you mentioned at Morningstar, but I didn't see any positions they had that appealed to me. Perhaps, because arbitrage plays are short term in nature, the reported holdings are outdated.
Right now I'm reviewing one possibility. A bank, NBTB, is buying another bank, LABN, and giving stock in the stated equivalent of $18.50/sh. LABN is trading below 15 1/2. One problem is that there's a collar around NBTB stock. The most shares would be .9487 NBTB per each LABN. And NBTB is dropping near its low for the year - about 19. So that makes the stock deal to be about .9487x19= $18 dollars. Another issue is the very small trading volumes and what to do if I want to sell just before or after the shares are distributed.
I also looked at HET buying Player's (PLAY). That's an $8.50 cash offer for PLAY which trades for $7 1/2 or thereabouts. They want to close the deal by year end. I passed, at least for now, because Player's is in some difficulty, imo, with the Louisiana gov't for allegedly paying bribes. There is some indication that there might be a possibility (sorry about all the couched terms -g-) that PLAY could lose their gambling license before the deal is consumated. And so the deal with Harrah's would terminate. Very tough for me to figure out what might happen. For others too I think - that's why stock is at $7 1/2.
Paul Senior |
