TIER - TIER REIT

[ritrading]

This is not my normal type of investment. This is a REIT currently trading at ~17.50. They recently went public. I bought shares because they've announced a Tender Offer. Details at - https://www.sec.gov/Archives/edgar/data/1176373/000110465915052680/a15-15726_11ex99d1.htm

 

Long story short, they're doing a tender offer for their shares for no less than $19. Offer deadline is Aug 19th. Tender sizes of 100 or fewer shares get priority. If more shares are being tendered than they want, they will allocate pro-rata above 100.

 

Seems like a quick win for small accounts. Optimal strategy seems to be to buy 100 shares for as many accounts as you can, and then tender them all.

 

Would appreciate if someone can double check my work, and let me know if I've missed something. This is as close to an arbitrage as I can find which can be taken advantage of by retail investors due to its strategy capacity constraints.

[DeepSouth]

This is not my normal type of investment. This is a REIT currently trading at ~17.50. They recently went public. I bought shares because they've announced a Tender Offer. Details at - https://www.sec.gov/Archives/edgar/data/1176373/000110465915052680/a15-15726_11ex99d1.htm

 

Long story short, they're doing a tender offer for their shares for no less than $19. Offer deadline is Aug 19th. Tender sizes of 100 or fewer shares get priority. If more shares are being tendered than they want, they will allocate pro-rata above 100.

 

Seems like a quick win for small accounts. Optimal strategy seems to be to buy 100 shares for as many accounts as you can, and then tender them all.

 

Would appreciate if someone can double check my work, and let me know if I've missed something. This is as close to an arbitrage as I can find which can be taken advantage of by retail investors due to its strategy capacity constraints.

 

This is known as an odd lot tender. Buy 99 shares, not 100. Here's the link for the COFB thread.

 

http://www.cornerofberkshireandfairfax.ca/forum/strategies/odd-lot-tenders/290/

[mateo999]

don't buy shares in "as many accounts as you can" if they're tied to the same address.  companies are onto this and typically aggregate.  also note that most retail brokerages charge somewhere in the $35 range to handle tender instructions.

[ritrading]

don't buy shares in "as many accounts as you can" if they're tied to the same address.  companies are onto this and typically aggregate.  also note that most retail brokerages charge somewhere in the $35 range to handle tender instructions.

 

Thanks for that. Any chance you know what fee Interactive Brokers might charge? Couldn't find it on their website.

[jmoy911]

No cost for IB

 

don't buy shares in "as many accounts as you can" if they're tied to the same address.  companies are onto this and typically aggregate.  also note that most retail brokerages charge somewhere in the $35 range to handle tender instructions.

 

Thanks for that. Any chance you know what fee Interactive Brokers might charge? Couldn't find it on their website.

[ritrading]

This is not my normal type of investment. This is a REIT currently trading at ~17.50. They recently went public. I bought shares because they've announced a Tender Offer. Details at - https://www.sec.gov/Archives/edgar/data/1176373/000110465915052680/a15-15726_11ex99d1.htm

 

Long story short, they're doing a tender offer for their shares for no less than $19. Offer deadline is Aug 19th. Tender sizes of 100 or fewer shares get priority. If more shares are being tendered than they want, they will allocate pro-rata above 100.

 

Seems like a quick win for small accounts. Optimal strategy seems to be to buy 100 shares for as many accounts as you can, and then tender them all.

 

Would appreciate if someone can double check my work, and let me know if I've missed something. This is as close to an arbitrage as I can find which can be taken advantage of by retail investors due to its strategy capacity constraints.

 

This is known as an odd lot tender. Buy 99 shares, not 100. Here's the link for the COFB thread.

 

http://www.cornerofberkshireandfairfax.ca/forum/strategies/odd-lot-tenders/290/

 

Thanks a lot!! Would be terrible to miss this on a 1 share technicality. And wow... didn't know there was a whole thread on odd lots!!