Of course you realize, this means arbitrage! $LSXMK & $LSXMA
Posted: Jul 05, 2024
- Opportunity to buy LSXMA and LSXMK at a 23% discount compared to SIRI shares - LSXM- shares will transform into 8.4 shares of SIRI - Option calls on LSXMK may be a better deal than on SIRI - Warren Buffet has purchased 10% of LSXMA and 20% of LSXMK - Trade is not about satellite radio, but about buying $1 with 77¢. - Liberty Media and SiriusXM are forming a new public company called New SiriusXM - New SiriusXM will have a single class of shares and be traded under the ticker symbol "SIRI" - Liberty Media and SiriusXM's transaction aims to eliminate the tracking stock structure and provide benefits like enhanced liquidity - New SiriusXM will be independent with greater strategic flexibility, expanded investor base, and improved trading liquidity - Transaction expected to be completed in the third quarter of 2024, subject to regulatory approvals and other closing conditions - The transaction will benefit all stockholders by allowing them to participate in the long-term potential of the leading audio entertainment company in North America - New SiriusXM will focus on providing live, human-curated audio experiences, expanding its subscription business, tapping into new audiences, and capturing opportunities in ad-based platforms - SiriusXM plans to continue delivering strong results, generating high EBITDA margins, and returning capital to stockholders
🚨 Reddit sentiment: mixed/negative - There is significant discussion about potential declines in $SIRI and the risks involved in the trade, despite some positive aspects about current prices and arbitrage opportunities. Summarized comments: - Interest in examining both $LSXMK and $LSXMA calls - Discussion about $LSXMK and $LSXMA discount relative to $SIRI - Some see $SIRI as a legacy business model with potential further declines - Consideration for not basing the trade on owning or holding $SIRI - Concerns over $SIRI calls expiring worthless if $SIRI falls - Uncertainty about the fixed or estimated ratio of $SIRI to $LSXMK/LSXMA - Strategies involving shorting $SIRI and going long on $LSXMK or selling calls on $SIRI - Possible negative outcomes like ratio changes, significant drops in $SIRI, or the deal not going through - Current sentiment is shaped by $SIRI short-selling and strong income potential - Anticipation of delayed, yet confident, deal progress - Contingency planning for deal failure or unforeseen events - $SIRI has significant borrowing costs, making it difficult to short further - Options strategies for $LSXMK/LSXMA around 1-6 months - Positive recognition for detailed and informative discussion - Need for a shareholder vote for $LSXMK before merger completion Stock tickers discussed: $LSXMK, $LSXMA, $SIRI
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