There actually is a reason for Alcan shareholders to hold and tender to Alcoa rather than sell at today's price. If you sell today, you make $85 or so. If you hold, and tender, you make $56 plus you now own shares in the combined company. If the Alcoa stock price goes up after the takeover, due to the benefits of the combined company, then you could make significantly more than $85. I haven't done the math to see how high the Alcoa stock price would have to go, but you can bet the institutions know exactly what that point is and are evaluating whether it is a better deal than taking the $85 today. The response from Alcoa today indicates that they have had conversations with these large shareholders, and have received positive responses. That has led them to NOT make a higher offer. I find that fascinating! This is big boys poker!!
I don't have a good understanding of how this all works. I do know at some point Alcoa will buy the shares at their purchase price. Those holding out take the chance that the stock will not go higher than today's close.
There's more at play here than just Alcoa. BHP is in talks with Alcan and if the price goes higher that further indicates belief that a higher price is attainable. At some point those with their finger on the pull leaver will do so when they think the run is over. Some won't make the sell so there in lies the gamble.
More important to me is what will happen to Alcoa if and when they bid a higher price. These two stocks are now showing their true marketable value. At some point the risk / reward point will be achieved make me an Alcoa stock seller. Getting close but I am going with Cramer on this one - Alcoa will reach 42 on a buyout or 45 on earnings. That puts me on hold for today. I am happy to see my 40 close. I thought that would have happened months ago, but that just proves high opinion of the company. Call it blind obedience I guess. I plead guilty. One cannot let a sell pass buy though when it is time. A move above 45 must trigger a sell in my mind.
If an AL shareholder also owns a larger number of AA shares, he or she might accept AA's offer as a donation to the AA shareholders. Otherwise, rational self-interest dictates that no AL shareholder consider AA's offer for more than a few milliseconds.