I just stumbled on to this industry. CCA, WHC, and PZN all looked good. So I bought some PZN and WHC. But I have questions.
1. With an exchange ratio of .875 PZN for each CCA the stock
prices obviously show lots of arbitrage. At todays closing price I could have "bought" one share of PZN for 1.142 shares of CCA, which calculates out to $19.07 per share of PZN.
I didn't do that, even though it seemed lots smarter to buy CCA, I guess I just liked the security of the dividend in these turbulent times, and I just got burned buying CIEN several months back because I really wanted TLAB. In any event I split my investment between PZN and WHC.
Anyway...with PZN selling for $21 there is a $2 gap here. That says something....what exactly I don't know.
2. Then I read about the special $2 dividend to be paid in late 1999 for each share of CCA and that effectively widens the gap to $4.
Is the merger likely to go ahead? Is there serious opposition?
The fundamentals and the story look so good here that I'd like to invest more, but where exactly to put it?