This can't be hurting:
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April 16, 1999 14:41
US OPTIONS/Cable & Wireless vols up, takeover talk
CHICAGO, April 16 (Reuters) - Implied volatility in options on Cable & Wireless Plc popped higher on Friday and interest built in calls as players began getting whiffs of takeover talk concerning the British telephone company, analysts and traders said.
Paul Foster, investment strategist and editor of 101wallstreet.com, said the market was starting to get wind of a story in the Saturday edition of the German newspaper Die Welt that Deutsche Telekom AG , Europe's biggest phone company, was in advanced talks to buy Cable & Wireless.
Earlier on Friday, European newspapers reported that Deutsche Telekom was weighing a merger with Telecom Italia SpA .
"There's a rumor that Deutsche Telekom would be interested in it (Cable & Wireless)," said Michael Benson, a market maker in Cable & Wireless options at the Chicago Board Options Exchange
Officials of the three companies declined to comment on the market talk.
Implied volatility for the May 40 calls jumped to roughly 56 percent around midday on Friday, up from 48 percent on Thursday. Volume on the May calls stood at 283 on open interest of 63 contracts.
"That's a significant move," Benson said of the volatility rise. "There's quite a bit of interest in it (calls). This is the first significant paper we've had in some time."
American Depositary Receipts of Cable & Wireless traded on the New York Stock Exchange were up 2-13/16 at 41-1/8 at 1303 CDT/1803 GMT after hitting a high earlier on Friday at 42-7/8.
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Which reminds me of an article I read in yesterday's IBD where John Sidgmore was asked about acquisitions.
"Fixed wireless? I don't know if we'll make an acquisition there or not. But we'll certainly have much more fixed-wireless capacity in our network two years from now than we do today."
Another great day!
Pat
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