Husky Energy Inc. cumulative redeemable preferred T.HSE.PR.B

RE:RE:RE:RE:Yields alone would make it CRAZY to short the Preferreds

[Shazam57]

Under the terms of the definitive agreement, Husky shareholders will receive 0.7845 of a Cenovus share plus 0.0651 of a Cenovus share purchase warrant in exchange for each Husky common share. This represents a 21% premium, excluding warrants, relative to Husky’s five-day volume-weighted average price per share as at October 23, 2020. Including the warrants, the premium is 23%. While the transaction was originally conceived as an at-market merger, resulting in a negotiated proportionate ownership level, the respective share values have diverged during the due diligence period over the past months. This resulted in a premium for Husky shareholders based on the current share prices.

The above text is directly copied from the Husky news room release. Seeing as they are calculating the price premium from October 23 which was 3.17 then to me it makes no sense to take the deal. We are way past the 21% premium or 23% premium if you are to include the warrants. I guess I will go with what people consider to be good though in my view since I'm averaged in at 5.50 I would actually lose money. I suspect there are some things that I'm missing but I guess it is what it is.

If the price of Cenovus goes up to 10 which is very likely in my opinion then it's still a sweet deal.