Taking advantage of the ongoing exchange offer by Baxter (BAX), here's a quick way to make $480. The exchange ratio has been fixed at 1.1591 shares of BXLT for each share of BAX. Purchase 99 shares of BAX and tender them into the exchange offer. Upon completion of the offer, the investor will receive 1.1591 shares of BXLT currently trading at about $43 per share. Fractional shares will be rounded down with cash paid in lieu of the rounded amount. Shares of BAX were trading at $45 at the time of this writing. Thus, a quick profit of $480 can be made:
99 * (43*1.1591 - 45) = $479.
In this particular offer, the broker needs to be instructed to check the odd-lot preferential treatment box whereas in other offers, it's sometimes an automatic election. The offer carries the provisions for guaranteed delivery procedures. Thus, unsettled stock may be tendered in most cases.
Please note:
99 * (43*1.1591 - 45) = $479.
In this particular offer, the broker needs to be instructed to check the odd-lot preferential treatment box whereas in other offers, it's sometimes an automatic election. The offer carries the provisions for guaranteed delivery procedures. Thus, unsettled stock may be tendered in most cases.
Please note:
Under NO circumstances should any content or communication here be construed as investment advice or a recommendation to buy or sell any security, whether expressed or implied. Factual statements are believed to be truthful and reliable, but are not warranted against errors or omissions. PLEASE do your own due diligence prior to investing.
