Seeking Alpha

Dan Fisher's  Instablog

Dan Fisher
Send Message
Private Investment advisor based in NJ with clients total investment portfolio size around $20 Million USD.
View Dan Fisher's Instablogs on:
  • Valero acquistion by Reliance is crafted news
    Note : Please exercise your own discretion for your trades .

    Valero acquisition by Reliance / Shell looks like more of a story created by some traders to make money from the rumor . After El paso deal last week , it is a good time to make people believe another story on M&A . Since Reliance is looking out for acquisitions , building a story around that had high chances to fly . Speculation about Reliance looking for Valero is there since a year . This is not new .

    Read this article from FT.COM in March 2010

    http://www.ft.com/intl/cms/s/0/eee92c6a-...

    Why this bid rumor is fake ?

    1. Because Valero has been on expansion . While it is making profits & expanding why would it be open to get sold for other ?
    2. Reliance will only buy companies if they are available for rock bottom prices . Its previous two attempts were both at failed / bankrupt companies . Valero is in good position now . Trying to buy valero now won't be cheap . So reliance may not bid for Valero now .

     I will be closing my Calls on Monday since on Tuesday we have earnings and the stock has moved a lot higher . Though the company will report good earnings , people will dump the stock since in the earnings call , Valero will rule out it is not open to sell the company now . This will bring the price back to 22 - 23 leves .


    Tags: VLO, WNR
    Oct 29 3:59 PM | Link | 1 Comment
Full index of posts »
Latest Followers

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.