18% Annual Return With Planar
Summary
- The $0.45 spread equals a substantial return
- The deal will probably close by Year End
- Here is why this is an attractive risk:reward
Deal Target Description
Planar Systems (NASDAQ:PLNR) sells tiled liquid crystal display/LCD displays.
Deal Terms
On August 12, 2015, Leyard Optoelectronic and PLNR signed a definitive merger agreement in which Leyard will buy Planar for $6.58 per share.
Deal Financing
The deal is not conditioned upon financing. The deal target is working with Bank of America (NYSE:BAC)
Deal Conditions
The deal is subject to certain closing conditions, including approval by the shareholders of both PLNR and Leyard, and antitrust and other government clearance. The deal does not require EU approval.
Deal Price
The deal is reasonable for PLNR holders in the context of historically comparable transactions.
Conclusion
PLNR is an attractive candidate for inclusion in a long-term, diversified portfolio.
Disclosure: I am/we are long PLNR.
Chris DeMuth Jr is a portfolio manager at Rangeley Capital. Rangeley invests with a margin of safety by ...
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