Q: Hi 5i
Given the announced deal setting the take over price at around $ 46 canadian, can you explain what is happening with the day to day sp fluctuations? Seems to be heading down with heavy volume.....seems strange......Other than opportunity cost of holding, in the short term, do you see this continue to slide lower?
Thx
Given the announced deal setting the take over price at around $ 46 canadian, can you explain what is happening with the day to day sp fluctuations? Seems to be heading down with heavy volume.....seems strange......Other than opportunity cost of holding, in the short term, do you see this continue to slide lower?
Thx
5i Research Answer:
Companies subject to a takeover always see heavy and volatile trading. The stock rose in 8 of the 10 days prior to the news, and fell 0.46% on Tuesday and 0.15% Wednesday in the US (we are using US pricing as the deal is in US dollars). Canadian moves were more significant because of currency moves. But we would not consider the price moves at all noteworthy here. There is always risk in any deal, but we would not really expect a continued slide here.