Discussion in 'Trading' started by Eldredge, May 23, 2003.

  1. Eldredge


    Can someone tell me why EXPE and ROOM are tracking each other? It looks like they are both owned/controlled by the same guy. Are they merging? Thanks for any help.
  2. both are being acquired by USAI...also TREE...the street loves this synergy...all four stocks have had huge runs...big accumulation on higher highs.......
  3. Eldredge


    Thanks for the response. These four - USAI EXPE ROOM TREE - stocks are trading so closely (almost identical on a percentage basis) it makes me think that they are going to be merged into one. Does anyone know if this might be the case?
  4. Homer


    I can't stand all the bashers on this site but c'mon!!! Is this post even serious???? one simple search on any finance site will lead you to the fact that USAI is acquiring all three. Starting an educational thread about the abc's of M&A may be in order. Please just do a little DD before you decide to start a new thread with a moronic question next time.
  5. Eldredge


    Sorry to upset you HOMER, after doing some searching, I realized that they were being purchased, but not all companies that are purchased by another (look how many companies Warren Buffet owns) trade identically. What I read didn't clarify that they would be merged into one, but I assumed that was the case based on the stock prices. That is what prompted my question. If you don't like the bashing (I don't either) I suggest that you refrain.
  6. lescor


    They are being acquired for stock, which is why they trade tick for tick with each other. If it was a cash deal, the companies being acquired would be pinned to the purchase price +/- any risk premium.

    FYI, I've been trading the USAI- EXPE, ROOM, TREE spreads, here are the stock swap ratios:

    EXPE 1.93875
    ROOM 2.4
    TREE .6199

    They are all tight spreads, you've got to be quick.
  7. You have to be really quick to trade these things off of each other, computers are doing most of the arbitrage there. (ecn's bid/offer and cancel nonstop all day trying to lock in the spread at different levels and take it off 2-3 cents later.

    really tough to put on lately to make more than a few pennies.
  8. Eldredge


    Lescor and Avalanche, Thanks for the very informative replies. That helps me understand what is going on, and I really appreciate it.