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ROH, DOW, BUD:Three Arbitrage Opportunities?

I bought Anheuser instead, which was a fortuitous decision. With Rohm, I'm confident of the financing, but I'm less certain about the closing date. Dow said they expected to close in early 2009. How do you define early? That could be anywhere from January to May.

5 Best Performing Dividend Stocks in 2008

BBT: hardly surprising. This is a bank that has long maintained conservative lending practices. They've made only modest writedowns and have a strong capital position. They've also maintained their dividends even through the crisis.

Market Jitters Enable Even Small Investors to Get a Piece of BUD

>AB is a remarkable company which I, for one am in awe of how well run it is.

That comment alone makes me distrust just about everything else you said. Anheuser mispositioned itself, concentrating on Budweiser and refusing to move upmarket to craft beers. This completely missed the trend in the US market, which was to craft beers, spirits and wine. Additionally, the firm failed to move into the international front (hence InBev had to do it for them). As a result, they had a couple years of quite weak results. Their management team was certainly not best of breed.

As for the arbitrage issue, think about it. If Ockham's analysis is right, they won't need anyone other than InBev to prop the price up. InBev will (they hope) pay out $70 in cash at the end of the year. Of course, the downside if InBev doesn't get the financing is more considerable; Anheuser would drop to the high $40s or low $50s.

My understanding was that InBev does have the proper commitments from the banks. Several of InBev's European banks were in trouble (Fortis was one of them). Beer is a relatively steady business and InBev has a great international distribution network. InBev paid a pretty high price, but they should definitely be able to make their payments. The banks, therefore, would probably want to make this loan.

Anheuser-Busch: The Big Bid For Bud

If Anheuser were a small craft beer, and if InBev wouldn't be properly representing them inside their mammoth distribution network, I'd say they shouldn't be allowed to buy Anheuser.

If InBev were involved in genocide in the Sudan, or some other egregious human rights violations, I'd say they shouldn't be allowed to buy Anheuser.

But otherwise, Anheuser is a publicly traded company. You list in the public markets, there are rules to play by. In this case, the rules are fair.