Merger Arbitrage Spread List January 20, 2019
This is the Merger Arbitrage Spread List January 20, 2019. A FREE list of the largest cash merger arbitrage opportunities trading on major US exchanges. The FREE spreadsheet below contains the latest essential deal information and criteria as per official company announcements. This merger arbitrage spread list provides the user with an investable database of deal spread opportunities. This information can provide a solid foundation for making merger arbitrage investing part of your investment portfolio. We encourage traders and investors to perform their own due diligence before making investments. However, merger arbitrage (also known as risk arbitrage) is relatively simple to understand and execute. The most recent spread listings can be found here.
This risk arbitrage tracking list provides the user with an investable database of deal spread opportunities. Rules for inclusion in this list can be found on the spread tracker eligibility rules page along with additional help and user guidelines. Unlike some data providers, dividends, which can have a dramatic effect on the value of a spread have been included in the return calculation.
The Past
- There were no closed deals from last weeks T20 list
- There were no failed deals from last weeks list (despite the ongoing regulatory issues and the lack of clarification surrounding a path of action from (AVA)
- The three stocks to drop out of last weeks list are Dun & Bradstreet Corp (DNB), Tesaro, Inc. (TSRO) and Navigators Group (NAVG)
The Present
- The T20 replacements this week are InfraREIT, Inc. (HIFR), TransMontaigne Partners (TLP) and Vectren Corp (VVC)
- There were no new cash deals announced during the week that make our list
- The largest spread this week again is AVA. Following the failure to obtain the necessary regulatory approval from the Idaho state regulator the stock continued to fall away this week. Parties to this deal have publicly stated they continue to consider this most recent setback and for this reason the deal remains active. The decline in price during the week exposes the stock to greater market fluctuations. However, with the spread stabilising at 28.33% the stock, the market has priced a zero chance of this deal being salvaged. We await a statement from AVA as they continue to consider their options. There is also the termination fee of $103m to be taken into account. That aside, the largest (simple) spread is PACB, offering a return of 8.99%. This rebounded during the past week followoing the second request for information from the FTC. This continues to displace RHT into third place whick fell during the week to now offer a spread of 8.26%. The annualised return however remains at a similar level, 8.78%, due to the extended time frame of expected completion. Returning entrants, InfraREIT, Inc. (HIFR) offers 1.24% (expected closing 6/30), TransMontaigne Partners (TLP) offers 1.05% (expected closing 3/31) and Vectren Corp (VVC) offers 0.44% (expected closing 3/31).
- The average spread for the entire T20 list (excluding AVA) is a 2.30% return which continues to decrease as the market continues its recovery and is below the recent historical average. This reflection of the solid performance of the broader market during the week is making it difficult to justify the level of return for the level of risk/volatility currently in the market at the portfolio. Some individual deals however do offer attractive returns especially those whose closure may occur sooner than the market anticipates. Traders are advised to take some money of the table where possible. A broader market sell off can still occur as the problems in the global political space remain unresolved. Be careful using leverage in these situations and maintain at least some dry power for future opportunities.
The Future
- There are no earnings announcements expected during the forthcoming week from the members of this weeks list
- There are no dividend payments expected during the coming week
- Any deal announcements relating to this weeks T20 list will be announced in real time, most often via out twitter feed @MergeArbLimited.
