Seeking Alpha
Editor's notes: Hedge fund manager Chris DeMuth analyzes the Uranium One buyout and concludes the wide spread sets investors up for a 40%+ annualized return, excluding the possibility of a bump.

Executive Summary

A go-private transaction between Uranium One (OTC:SXRZF) and ARMZ Uranium Holding Co. (ARMZ) trades for a wide 11-cent spread to the deal price, has a high probability of completing with limited downside, and offers an annualized return of 43%.

The Thesis

Our natural proclivity is to avoid those things that make us uncomfortable. We've been programmed over thousands of years of survival to take recent, vivid, bad memories and overweight them in decision making. So on the one hand; this made our ancestors good at avoiding being eaten by saber toothed tigers when tall grass moved, but on the other it makes us fairly lousy investors.

There are few words that make me more uncomfortable...

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