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Buy viagra super active+ without prescription, In my prior post, "Allied Capital Goes from Value Trap to Deep Value," I made the point that the Ares/Allied acquisition created a potentially interesting merger arbitrage opportunity. As astutely pointed out by commenter BeauZeau at Seeking Alpha, approved viagra super active+ pharmacy, Order discount viagra super active+ online, the merger arbitrage opportunity is not quite as large as I portrayed.
In a classic merger arbitrage, viagra super active+ online without prescription, Viagra super active+ us, the investor ought to short the acquiror (ARCC) and buy the target (ALD). That is because, viagra super active+ medication, Viagra super active+ drug, assuming that the deal closes, the target and acquiror shares are now representative of the same asset, buy viagra super active+ online without prescription. Sale viagra super active+, Consequently, any price discrepancy between the two stocks represents a fundamental disconnect with underlying value*, viagra super active+ online stores. In the case of ARCC and ALD, I posited that the proposed exchange rate of .325 ARCC shares for each ALD share creates an opportunity based on current closing prices, buy viagra super active+ without prescription. Buy viagra super active+ online australia, *Those familiar with the concept of arbitrage will see my description of merger arbitrage as a flawed definition of arbitrage. Officially, viagra super active+ india, Viagra super active+ cheap, merger arbitrage is a risk arbitrage and is not the same as a traditional riskless arbitrage opportunity. I intend to write a follow up post for those who have less experience with this concept later this week, generic viagra super active+. Generic viagra super active+ online,
At Ares' closing price of $10.46/share, ALD shareholders would be entitled to approximately $3.40/share in value, fda approved viagra super active+. Buy viagra super active+ without prescription, This represents a 7.9% premium versus ALD's closing price of $3.15. Find cheap viagra super active+ online, In a classic merger arbitrage, however, real viagra super active+ without prescription, Best price viagra super active+, shorting ARCC would require the investor to pay upwards of two quarters worth of dividends (the ARCC/ALD merger is expected to close by Q1 2010). ARCC currently pays a 13.4% annual dividend yield, cheap viagra super active+ on internet. Buy viagra super active+, Two dividends would equate to roughly 6.7% in yield. As such, buy cheapest viagra super active+, Viagra super active+ cheap price, the true spread between ALD and ARCC is closer to 1% than the 7.9% that is initially seen when only comparing stock prices.
Merger arbitrage does contain some risk, buy viagra super active+ without prescription. The deal may not close in time which could result in an arbitrageur missing more of ARCC's dividends, viagra super active+ side effects. Viagra super active+ prescription, The deal may not close at all which could have completely unpredictable results on stock movements, thus destroying the pair trade (short ARCC/long ALD) opportunity, canadian pharmacy viagra super active+. Cheapest viagra super active+ online, As such, the minute 1% spread is a good sign that the market is pricing a near definite probability of this transaction closing and believes just 1% in return over the next 6 months is adequate compensation for the risk, order viagra super active+. Viagra super active+ online cheap, In this sense, a classic merger arbitrage of ALD and ARCC seems much less worthwhile to us retail investors who don't have massive balance sheets to throw at small percentage gains, low cost viagra super active+. Buy viagra super active+ without prescription, Despite this, I believe the initial thesis of my prior post on the opportunity to purchase Allied Capital stock holds true. Cheapest viagra super active+ prices, Prior to this acquisition, Allied Capital's auditors were issuing going concern warnings, viagra super active+ cheapest price. Get viagra super active+, With the balance sheet and liquidity provided by Ares, Allied Capital's undervalued portfolio definitely looks much more attractive, purchase viagra super active+ overnight delivery. Cost viagra super active+, That being said, on a risk adjusted basis, viagra super active+ tablet, Buy viagra super active+ low price, it would seem much more prudent to outright purchase ARCC at this juncture as you would be "guaranteed" dividends over the next few quarters and you won't have to worry about the risk of the transaction not being confirmed.
Full disclosure: Author has no positions in the stocks mentioned in this post, cheapest viagra super active+ price. Viagra super active+ in malaysia, . Buy viagra super active+ cheap. Viagra super active+ free sample.
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[...] my previous post on the Allied-Ares merger arbitrage opportunity, I introduced a topic which I realized I’ve never quite talked about here on The Curious [...]
[...] my previous post on the Allied-Ares merger arbitrage opportunity, I introduced a topic which I realized I’ve never quite talked about here. As I intend this [...]
[...] my previous post on the Allied-Ares merger arbitrage opportunity, I introduced a topic which I realized I’ve never quite talked about here on The Curious [...]