StockData.org - Arbitrage Opportunities

Looks like the RX deal will go through, as the shareholders approved the merger yesterday.  I’ll make a small ROI on the arbitrage.

From news wire:

“Clothing retailer Talbots Inc. said Monday it has amended its secured revolving loan agreement with shareholder Aeon Co. to repay all of its outstanding third-party bank debt.”

“The amendment is part of a larger plan for Talbots to merge with holding company BPW Acquisition Corp.” - AP via Yahoo

“With this satisfaction of all of our outstanding third-party debt and the elimination of our year-end maturities, we can now more closely focus on completing the merger between Talbots and BPW to deliver greater shareholder value,” Talbots’s chief executive, Trudy F. Sullivan, said in a statement.” - NYT DealBook

Looking good….

RX said the are holding a meeting Feb 8, 2010 for a shareholder vote on the proposed acquisition by Healthcare Technology Holdings, Inc.

Source: http://ir.imshealth.com/phoen…

For details on the deal, read my post here.

Disclosure: I own shares of RX.

I bit on all three small arbitrage opportunities today and added them to my real money portfolio.  ROI’s from between 3.3% to 8.7% based on today’s stock prices.  My goal is to net 5% ROI combined and be out of the position within 3-4 months (for about a 20% annualized return).  To see my entry points on these deals, and all of my current and past holdings, go here.

BPW Acquisition Corp. (BPW) by The Talbots, Inc (TLB).

“BPW common shares will be exchanged for the equivalent of $11.25 per BPW share in Talbots` common shares within a floating exchange ratio range of between 0.9000 - 1.3235 Talbots shares per BPW share, based on the trading prices of Talbots common stock prior to the BPW stockholders meeting.”

Source: http://www.reuters.com/fin…

Encore Acquisition Company (EAC) by Denbury Resources Inc (DNR).

“Encore stockholders will receive USD50.00 per share for each share of Encore common stock, comprised of USD15.00 in cash and USD35.00 in Denbury common stock, subject to both an election feature and a collar mechanism on the stock portion of the consideration”

Source: http://www.encoreacq.com/releasedetail.cfm?ReleaseID=420627

IMS Health, Inc. (RX) by Healthcare Technology Holdings, Inc., an entity created by certain affiliates of TPG Capital, L.P. and the Canada Pension Plan Investment Board.

“IMS shareholders will receive $22.00 cash for each share of IMS common stock they own”

Sources:

http://www.imshealth.com/port…

http://www.businesswire.com/portal/si…

Disclosure: I own shares in BPW, EAC, and RX.

Looks like the Sprint/Deutsche Telekom deal might not happen. I am pulling the rip cord and selling for a -14.88% ROI. Yeeks.  My orginal post here where I initiated a position.

” … Deutsche Telekom AG Chief Financial Officer Timotheus Hoettges said there’s no need for further consolidation of the U.S. mobile-phone market.  …”

I sold CYCL at $8.37 today.  Considering the deal with AT&T is $8.50, I think I am close enough to bail (plus the deal is not 100% yet).  So, I was in at $7.46.  This was not a simulated position.  I bought 400 shares.  So, my stats on this deal were:

(400 x $7.46) + $4.50 commision = $2,988.50 basis.

(400 x $8.37) - $4.50 commission = $3,343.50 proceeds.

$3,343.50 - $2,988.50 = $355 net.

$355 / $2,988.50 = 11.8% ROI.

Bought on July 29, 2009, so my annualized return is:

11.8% / 74 days * 360 = 57.4% Annualized ROI

Patriot Capital Funding Inc. (PCAP) is being bought by Prospect Capital Corp. (PSEC).  Another all-stock deal.  I’ll get 0.3992 shares of PSEC for each share of PCAP.   It is supposed to close in October, so my money turn over on this one should be quick.

Crunch:

Buy 1 share of PCAP today (9/21/2009) for $3.89 and, when the deal closes, today’s price of $10.26 for PSEC would equal $4.10.  Meaning, the arb gap is $4.10 - $3.89 = $0.21, netting 5.4% ROI.  Annualized, if this turns around in one month, that’s a nice return for me.

If I enter this, it will be around $3.89 today.

Sources:

Reuters

Harleysville National Corp. (HNBC) by First Niagara Financial Group (FNFG) all-stock deal.  (I am not a big fan of all-stock deals). The exchange ratio is 0.474 FNFG shares for each HNBC share.

Current prices 9/21/2009: HNBC $5.63 and FNFG $13.02.

Crunch:

I buy one share of HNBC today for $5.63.  The deal closes and I get 0.474 sh of FNFG, prices today at $13.02, or $6.17.  That’s a net of $6.17 - $5.63 = $0.54 or, in ROI terms: 0.54 / 5.63 = 9.6%.

I may enter this one today @ around $5.63.

Sources:

• Tipped of by 247wallst.com
• Reuters

AT&T and CYCL both said recently that the merger deal will happen early Q4, 2009:

“… AT&T and Centennial Communications Corp. (NASDAQ: CYCL) announced today that, assuming timely satisfaction or waiver of all remaining closing conditions including receipt of the required regulatory approvals, they now anticipate the pending acquisition of Centennial by AT&T to be completed early in the fourth quarter of calendar year 2009. On November 7, 2008, the two companies entered into an agreement under which AT&T would acquire Centennial. Under the terms of the merger agreement, Centennial stockholders would receive $8.50 per share in cash. …”  (full Business Wire article)

I plan on keeping my recently purchased shares until the $8.50 is hit or the deal consumates.

Looks like my position in TAGS paid off (press release here).  (Here’s my original post on when I bought it).

I was in at $0.72.  The deal was $0.85.  My deal ROI was 18% (annualized ROI 35%).  Not bad!

Other sources:

TradingMarkets.com article