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Dan Fisher
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Private Investment advisor based in NJ with clients total investment portfolio size around $20 Million USD.
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  • 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

    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
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