Q: Hi Team,
Would it be a stretch to buy Meg shares today on the speculation that another considerably higher bid will come in? Weighing the odds here; could be some easy money to be made here.
Thanks ,
Shane
Would it be a stretch to buy Meg shares today on the speculation that another considerably higher bid will come in? Weighing the odds here; could be some easy money to be made here.
Thanks ,
Shane
5i Research Answer:
Arbitrage is never really 'easy'. SCR could walk away and MEG stock would get hit. But with a 9.2% ownership we would find this unlikely. Their best move is a higher bid before some other party shows up. At 11X earnings now, we would be OK keeping MEG anyways. We will take off the word 'easy' but we would be comfortable buying some.