But no sweat. They exercised 20,000 options at $17.27 for a total cost of $345,400. They then sold 11,951 shares at $28.90 for 345,383.90, Bottom line, they each received 8,049 shares for $16.10. What a deal, The options would have expired on the 29th.
Omnivision gave the buyer an excellent deal at the expense of shareholders. The buyer is not the owner of the company. Yet Omnivision earned over $2 per share since last August when the buyout was announced. Legally the earnings should be distributed to the legal owner that is us shareholders. If the deal close on Apri 2016, we shareholders will lose additional three quarters of earnings. And this money is reserved for the future owner. Is this according to SEC rule?
The cash penalty for the buyer to back out is about $1 per share. Essentially back in April they purchased a 1 year 29.75 call option for a $1.
If the deal doesn't go through consensus is this is a $22 to $24 stock. So from the short perspective, if you short at $28.80, and the buyout at 29.75, you risk $1.00 with the chance to make $5 to $6. I personally think the odds are 20:1 that the deal goes through. CFIUS was the biggest hurdle and that is past.
Yes. They extend the date. If the chinese back out they keep about $1 per share of cash. As of last April they have sold the Chinese a call option strike price 29.75 expiration date January 2016 for $1 per share. If the deal goes through you are allegedly suppose to get your cash before the end of April 2016.
With today's close at $28.67, the return is $1.08 in 5 months 18 days. Or about 3.77%.
The deadline for the "deal" is Oct 31, 2016. Although, the deal is expected to go through sometime between now and April, 30th. So the stock sits about .80 to $1.00 below. Roughly 3% 3% in close to 6 months isn't worth waiting around for plus the 5% to 10% chance the deal doesn't get done and the stock drops to 24ish.
I think most believe the deal will go through. If there was real concern, there would be a market for put options. The bids on put options are slim to none. .
Am I reading this correctly? "On October 29, 2015, OmniVision elected to extend the termination date specified in the Merger Agreement until January 31, 2016". Are they extending their option to back out of the sale? Hmmmm.
"is this a done deal?" No, you'll know when its a done dealt when you broker deposits cash into your account. Based on todays filings, which is a bunch of gobbly #$%$, it appears that Hua is getting serious and wants to limit the price differential for options given out by the company. If they weren't serious and weren't planning on the merger why would the care?
The price of this stock is determined by the MM's and traders. The reward for purchasing OVTI is not worth the risk, therefore few if any actual purchasers have an interest.
Hong escaped from mainland China many years ago by boat. His daughter is in Shang Hi and my only regret is I won't be their to wave good bye when he escapes back to China with a pot load of money.
Okay Shaw we are now in the 3rd quarter. Let me remind you of a previous statement you made.
With our new partners? knowledge and insight and the added flexibility that we will have as a private company,
OmniVision will be able to focus on reaching the next level of growth, which will benefit our employees,
customers and business partners.
You say it will benefit the employees (which I doubt is true), your customers (are you kidding me) and your business partners (true), In good taste you didn't mention yourself, your BOD and senior staff which will benefit the most from the merger. I wish you luck with the merger and only ask for one thing. For once think about your investors and get us out of this piece of #$%$ as soon as possible.
I meant the downside for the people who are shorting is minimal. Hence the shorts do not mind trading for a quick buck. Look, from the point of view of a long position, you have a simple decision to make. You either sell your position and leave 2-3% upside on the table or hold on to squeeze till the very last drop. At this point the first option looks more attractive given the chance (however remote) of the possibility that the deal might somehow fall through.
A 2.355 million short position isn't significant. The point that it is increasing about 200K every two weeks when the company sale could take place in a week could be significant. Then again it could be someone with more money than brains.