APE and AMC conversion

destriero · Aug 24, 2023

destriero said:
It’s a method of arriving at post conversion valuation assuming that the deal is final and no friction on the components. I have no idea how many synthetics you can short at 3.67. APE was 2.27 marketable at the close.

I am going to feel stupid if I missed something here, but if my understanding of the deal is accurate then you’ve netted 1.4 pre/14 post split (ignoring sweetener). No risk to (option) structure as you’re in a conversion.
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This was the critical post. And damn if the f*cker didn't open at 14.

duckruck · Aug 24, 2023

I found this trade last Wednesday and entered it on Friday, but exited early on Monday of this week.

TrailerParkTed · Aug 24, 2023

destriero said:
Yeah, the arb netted $14/share post split. I don't have my conversion gains yet as the components are still trading, but I am not going to unwind it (would cost a dime, pre-split).

IOW, if you (theoretically) could trade the entire float with no friction... you earned the current market cap of AMC.
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Stupid question, why would someone buy a $10 put today for $8? Are the options not included in the conversion yet?

destriero · Aug 24, 2023

The split has occurred which means APE will cease trading tomorrow/ They have split the contract in vol (11/100 showing).

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APE and AMC conversion

destriero

duckruck

TrailerParkTed

destriero