Merger Arbitrage Altia and Arcus

Jun 23, 2021

This is a chart, a spread chart, of the merger with Altia (Finland) and Arcus (Norway). In these types of spread charts, I prefer using lines instead of for instance candles. The merger was news in Sept/oct 2020, and you can see where the spread settled for a range from that period, ranging between 9 - 4 approximately. This is my first chart here at tradingview so please bear with me, as I am sort of a newbie in the tradingview community, and my English is kind of rusty after hibernating for a few years. I am a former proprietary trader, 12 years, who now tries to educate and coach newbies and intermediates in trading.

When I was an active trader I did a lot of arbitrage and pair trading. Especially specializing in merger arbitrage with stock deals, and high correlation pair trading. Found it to be a flexible kind of method or strategy as I could daytrade the spreads as well as swingtrade them. And even hold the spreads from start to finish in order to collect the premium as an example of position trading.

This chart shows that the current spread in this merger is approx. 5.20 now, and that is in Norwegian kroner, NOK. In USD it would equates to around 70 cents or 0,7 USD. The finish alcohol company Altia, ticker is the same, listed on the Helsinki Stock Exchange, is acquiring Norwegian alcohol wholesale company Arcus (ticker is the same). In the deal shareholders of Arcus is to receive 0,4618 shares of Altia. The deal is expected to close this summer or fall of 2021. This is the first merger involving two different countries as well as two different currencies I have watched closely and now created a spreadchart of. I will try to chart arbitrage opportunities as well as other ideas going forward, and I hope I can be a productive member of the tradingview community. Thx to everybody else here for publishing and sharing!OMXHEX:ALTIAOSL:ARCUS

Jun 23, 2021

Trade active

During this sideways range, the aim has been to utilize the swings to ones advantage, shorting the spread above 8-8,50s and going long at the 4 level or lower. It is also possible to scale in and out, let's say if you divide your total share in to for instance 3 units. That is relevant when either daytrading or swingtrading the spread. If one where to put the spread on and hold until completion, one would short the spread at 5-6 or higher if possible, by shorting 460 shares of Altia and buying 1000 shares of Arcus going long. That would capture the remaining premium and be the potential profit at completion, as well as shares of the two equaling each other out theoretically speaking.