Rumor : Samsung is buying Nokia for $22 per share

Anyone knows more about this rumor?
I am buying call 14 for June

 

Now that I think this merge makes sense.

 

First I've heard of it.

Then again, now that you've said it, it's a rumor.

I know, let's spread the rumor on Twitter!

 

Where did you hear this? Or did you just make it up?

 

No I did not make it up. I just bought 10 calls at 1.20. I am not a big player. I heard from one of my close trading buddies who works on the floor.

 

No way this is going to happen. Samsung has nothing to gain by buying Nokia right now considering they have all the know how to build phones.

 

I still consider it as a rumor but if that is true, LG and Sony might outbid and there would be a price war.

 

LG can't outbid another fellow Korean co on international purchase. Not one of this size where a lot of borrowing would need to be done.

And where's the money coming from?

 

Even if you were right about the actual proposed directional move, I'd be concerned about the IV on a straight call purchase (about 57%). If takeover news comes out, the stock's price will pin and IV will fall to near 0.

A bull call spread can be purchased for way less and give a much better risk/reward.

 

That would be about $80B. Don't you find it's too expensive?