Well, I guess I just don't learn. I was short 8000 over the President's Day holiday and lost 16,400. It's a weird deal, other than the overpayment. Justice Dept/ FTC tend to challenge deals where the premerger HHI (Herfindahl Hirschman Index) is over 1800 and the merger increases it by more than 100. They are starting with an HHI over 2,000 and increasing it by over 600. Nevertheless, the parties agreed that it would not be considered a "material adverse change" unless the required divestitures are over $8.5 billion. That's a HUGE number. Personally, I think you could build a new national network just with that amount. Whitacre couldn't buy the satellite company, so he has to buy this. I'm glad my SBC bonds got called last year.
Cingular is nuts to pay 41 billion. This smells of machisimo to me. Now Vodafone is going to dump Verizon as a proverbial sulking..hmm maybe SBC can come up with 100 billion to scoop up VZ at 'bottom bargain' prices. awe is not worth 41 billion. I must give the suits at T kudos they played thier cards perfectly and they will profit handsomely. Scalp
isnt it a better idea to short the buyer instead of the seller in a deal stock play as soon as the deal is announced?
I never dreamed they'd pay over $13, actually I thought $12.50 was tops, and I figured a 10% risk discount,, so I thought a short at 11.82 was OK. I still think AWE may go so far south the deal doesn't get done.
"I still think AWE may go so far south the deal doesn't get done." What is your reasoning behind that statement?
It's just unbelievable that companies that should in all sense be bankrupt are instead being bought out for absurd sums. AT&T in general is a failing pathetic excuse for a company. Their cash reserves from their monopoly abuses are drying up as they have been going farther and farther into debt. Anyone who has dealt with them as a consumer or business knows how horrible they are. Sprint PCS is next, mark my words. Watch them be bought out because they are certainly losing the battle. This is all a fabrication by the Fed. Cheap money, pumped up market and justification of absurd debt levels. I guess the way to make money on this is to buy failing companies because they are going to get bought up at a premium. Unbelievable. As a lesson from this thread, do not try to short obviously failing companies that truly hold no value. I've seen traders get destroyed by shorting companies that were so bankrupt that the government was repossesing their assets.
To the person who wanted an explanation, just google the words "Herfinadahl Hirschman", or as Dennis Miller says, you can use the new Yahoo search engine by going to Google and typing "Yahoo search engine"