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Merger Arbitrage Blog

Merger Trades Update

SOLD INVENSENSE

I bought Invense on 1st May after rumors that the company lost some Apple business to a competitor. The news caused Invensense to drop to a low of $12.70. I didn't manage to buy much before the price started to recover and eventually i sold off all my holdings at $12.96 on 10th May for a profit of 87% annualized return.

SOLD TRIBUNE MEDIA

I starting buyingTribune after the rumors about multiple buyers bidding for the entire company surfaced. Eventually the buyout was announced and I promptly sold all my holdings since the deal was part shares and part cash. I prefer to hold fully cash mergers. Profit was 10% gain in 8 days. A buyout rumor if played properly can most of the time result in much more profit than those already announced. 

BOUGHT MONSANTO, MOBILEY, BROCADE, NXP SEMI, ALERE

I started adding small quantities of the following stocks except Alere. These merger related plays are for intermediate and long term holdings so I will add when the prices are right. I believe all these stocks have reasonable chances of closing. Its only how much time that is needed.

Alere is a special situation where adverse news broke out that the company was unable to furnish its 10-Q again! With the merger closing this year, there is little time for the company to sort out its financial statements. The merger spread widened from 4% to 9% so I bought a little bit to play. In my opinion this will close but things may still get dicey before that.

 

 

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