Psuedo Arbitrage Opportunity with Bluma IMPORTANTE: Psuedo Arbitrage Opportunity (time sensitive)
Today's announcement on Bluma's acquisition by Cresco Labs caused Bluma to rocket but not as much as you think. Here are the details
Exchange Ratio (Cresco Share/Bluma Share): 0.0859
Current Cresco Share Price: $13.3
Implied Value per Bluma Share: $1.14
Current trading price on Bluma shares is $1.04
This represents a 10% spread which is attractive and larger than normal (in part because Bluma is a micro-cap).
The deal is expected to close at the start of Q2.
Downside Risks:
1. Cresco acquisition does not close
2. Cresco prices fall by more than 10% (you have a 10% fall cushion for this to work)
Upside Risk:
1. Cresco prices rise and you get more than the 10% upside.
Enjoy and if it works, thank me later....but remember....DO YOU OWN DUE DILIGENCE!