Merger agreement pays GPRO shareholders $285M total, or $1.14/share cash, while they keep ~10% of the new public company. At $1.30, the cash portion covers ~88% of purchase price, leaving the retained equity as a near-free call option. This is a reasonable event-driven long/stub trade if the deal closes without a large working-capital reduction. Cash payment can be adjusted by net working capital; deal may fail or be delayed; value of retained 10% stake is unproven; Starman financials are undisclosed.
Merger agreement pays GPRO shareholders $285M total, or $1.14/share cash, while they keep ~10% of the new public company. At $1.30, the cash portion covers ~88% of purchase price, leaving the retained equity as a near-free call option. This is a reasonable event-driven long/stub trade if the deal closes without a large working-capital reduction. Cash payment can be adjusted by net working capital; deal may fail or be delayed; value of retained 10% stake is unproven; Starman financials are undisclosed.