Merger Arbitrage Trading Strategy
- Merger arbitrage is an investment approach that focuses on predicting the successful acquisition of publicly traded companies during the period from announcement to closing
- The market’s uncertainty about a transaction’s success is reflected in the spread between the target company’s trading price and the offer price
- Mergers often close in a few months, leading to the potential for high annualized returns
- While it’s crucial to acknowledge that not every merger reaches a successful conclusion, a majority of deals typically do
Current Merger Arbitrage Opportunities
| Symbol | Acquiring Company | Offer Price | Current Price | Spread | Deal Type | Close date | Annual Return |
|---|---|---|---|---|---|---|---|
| CPRI | Tapestry (TPR) | $57.00 | $16.59 | 243.6% | Cash | 9/30/2024 | 573.28% |
| X | Nippon Steel (NPSCY) | $55.00 | $45.74 | 20.2% | Cash | 9/30/2024 | 32.96% |
| CERE | Abbvie (ABBV) | $45.00 | #N/A | #N/A | Cash | 6/30/2024 | #N/A |
| KRTX | Bristol Myers (BMY) | $330.00 | #N/A | #N/A | Cash | 6/30/2024 | #N/A |
| JNPR | Hewlett Packard Enterprise (HPE) | $40.00 | $35.92 | 11.4% | Cash | 12/31/2024 | 31.11% |
| SOVO | Campbell Soup (CPB) | $23.00 | #N/A | #N/A | Cash | 6/30/2024 | #N/A |
| HAYN | Acerinox | $61.00 | #N/A | #N/A | Cash | 9/30/2023 | #N/A |
| ZFOX | Haveli | $1.14 | #N/A | #N/A | Cash | 6/30/2023 | #N/A |
| HARP | Merck (MRK) | $23.00 | #N/A | #N/A | Cash | 6/30/2023 | #N/A |
| EVBG | Thoma Bravo | $28.60 | #N/A | #N/A | Cash | 6/30/2023 | #N/A |
| AMAM | Johnson & Johnson (JNJ) | $28.00 | #N/A | #N/A | Cash | 6/30/2023 | #N/A |
| IMGN | Abbvie (ABBV) | $31.26 | #N/A | #N/A | Cash | 6/30/2024 | #N/A |
| MGRC | WillScot Mobile Mini | $123.00 | $112.89 | 9.0% | Cash | 6/30/2023 | 4.62% |