Ron--There is the record date for the spin off and the distribution(x dividend date) for the spin off.
If the record date is 9/30, but the distribution date is say 10/3, that means those who buy on 9/30 get the spin off. However, those who sell on 10/1, 10/2 also sell the rights to the spun off shares.
So, you must hold CSMA until the distribution date to get the spun off shares. And the big unknown is still how long the restriction will last. For those who can afford to wait for the restriction to be lifted, it's probably worth buying at these levels.
Now, after the distribution date, the value of CSMA cannot possibly stay at .16 to .18. I acknowledge that an arbitrage possibility exists, but it is my understanding that the vast majority of the assets of CSMA will rest in the two spinoffs. So, yes, there will probably be an instant in time where the CSMA shell will trade well above its true value, but there is no certainty to that. Markets correct those divestitures very quickly.
Depending how long the shares are restricted, there will also be opportunities to buy those restricted shares, outside the market and at discount.
TG |
