I am looking at selling Nov 50 BRY puts, which sold for $6.2 today. If BRY closes under 50 when its acquisition by LINE is slated to close, does the seller of those Nov 50 options get straight put to all 100 shares? If so, that gives a BRY basis of 43.8 which means getting LNCO for 35.04 (after the 1.25 sh LNCo/sh BRY), a 10% discount to LNCO over its current selling price.
I know in straight cash acquisitions, ALL options cease trading at close and only ITM options have value but i am uunclear if the same rule applies to share swap mergers like with LNCO/BRY
especially since the Nov 50 BRY puts expire well after the deal is slated to close ~July 1. Its like getting time value for free, almost falls into the "too god to be true" category. I tried to reach BRY and LINE IR but couldn't get through and my message has not been returned yet
anybody up on arbitrage rules pertaining to ITM put options of companies like BRY to be acquired by share exchange?