Dear Diary,
A "Voluntary Tender" offer was made for the outstanding shares of ALO by the buyer, but I would have had to make the arrangement with my broker to do the deal and pay the transfer agent a $25 fee, my broker informs me. ALO stopped trading on December 31, 2008, but my broker tells me an "Involuntary Tender" will be coming soon to close the arbitrage out in my account without cost to me.
I've made money on Cash on Sale Arbitrage since I started in August, 2008, but it is volatile at times and the HUN deal is still trading at a $1 loss were I to sell it today.
So, I bought Patterson Companies (PDCO), a dental supply company, etc. with Consumer Monopolistic qualities at $19.24 a share on 1-7-09, near a p/e ratio of 10 on $1.90 projected 2009 earnings per share and a widening Net Profit Margin.
I also picked up shares of IEX today at $23.49 a share, also with Consumer Monopolistic qualities, based on 2009 projected earnings per share of $2.45 and a widening Net Profit Margin.
Gene
Monday, January 12, 2009
Monday, January 5, 2009
ROH Deal Closed
Dear Diary,
I just closed the ROH arbitrage for $63.28 a share, a 2% gain over an 80 day holding period. The average buy price was $61.76 a share on two purchases (10-16-08 and 12-29-08). This represents a 9.13% annualized gain on the deal. I sold out because of the volatility of the deal: Kuwait dropped a $15 billion contract with DOW, the buyer of ROH, with the assumption that the Kuwait money is to be used to buy ROH.
All arbitrage situations are closing fine except for the HUN deal, but I'm only about $1.00 a share out of the black on that deal. Overall, arbitrage is a fine business, and I expect to be doing it a long time.
I had some trouble logging into my blog today, so I hope there is no problem with the system.
Gene
I just closed the ROH arbitrage for $63.28 a share, a 2% gain over an 80 day holding period. The average buy price was $61.76 a share on two purchases (10-16-08 and 12-29-08). This represents a 9.13% annualized gain on the deal. I sold out because of the volatility of the deal: Kuwait dropped a $15 billion contract with DOW, the buyer of ROH, with the assumption that the Kuwait money is to be used to buy ROH.
All arbitrage situations are closing fine except for the HUN deal, but I'm only about $1.00 a share out of the black on that deal. Overall, arbitrage is a fine business, and I expect to be doing it a long time.
I had some trouble logging into my blog today, so I hope there is no problem with the system.
Gene
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