Tom, It should go through, but the questions are three: 1. The probability that it will go through. After Ciena fell apart, nobody is betting the ranch on any of these things. 2. The probability it will go through at the stated price. If something fundamental happens or if there is stock involved, the price could vary. 3. When it will go through. There is a cost of having money tied up in an issue. If there are govt. or shareholder objections, it could drag on. CA is the second largest software co., so this is not a moot point.
Risk arbitrage always looks like easy money. But then we have to wonder why so many individuals and firms go broke doing it. The reason is simple. You are betting a lot to gain a little. You will make the money most of the time, but when you lose, you lose more than you can make on several winners. So, there is no easy money.
My two cents is that the deal goes down and smoothly and it is probably easy money. But I don't take low return, high risk bets, so I'm not playing it.
MB |
