Merger Arbitrage Mondays – April 30, 2012

Merger activity dropped last week with two new deals announced and five closing. We did some interesting spreads last week when Motorola Mobility (MMI) dropped intra-day to $37.08 after Google (GOOG) announced plans to sell a Galaxy Nexus Android phone by Samsung. The spread on this $40 all-cash deal jumped from over 3% to over 6% and I used the drop to start a position in my personal portfolio as mentioned on my Twitter feed. The spread has once again narrowed to 3.33% but still represents potential annualized gains of 19.62% provided the deal closes by the end of Q2 2012.

You can find all the active deals listed below in our Merger Arbitrage Tool that automatically updates itself during market hours.

Deal Statistics:

New Deals:

1. The acquisition of Ardea Biosciences (RDEA) by AstraZeneca (AZN) for $1.26 billion or $32.00 per share in cash.
2. The acquisition of GeoResources (GEOI) by Halcon Resources (HK) for $1 billion in a cash plus stock deal. Under the terms of the merger agreement, GeoResources stockholders will receive $20.00 in cash and 1.932 shares of Halcón Resources common stock for each share of GeoResources common stock that they hold. Interestingly the spread on this deal is still 9.54% or 22.61% annualized without taking the borrowing cost for Halcon Resources into account.

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