Right now $ATVI is trading at $78.98. $MSFT wants to pay $95 per share. Deal is supposed to close some time in 2023. Instead of buying shares, why not buy ITM LEAPs at a strike of $70 for January of 2024 to get more profit?
Scenario A) – Deal goes through. SP goes up close to $95 and you make a lot of profit, a lot more than the 20% you would have buying shares.
Scenario B) – Deal falls through for some reason, maybe legislation stopped it. This will cause SP to tank but $ATVI is a great company with legendary titles (COD, WOW, etc) and should be able to rebuild their value by January 2024.
What am I missing here ?
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