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A deal spread calculation suggests a potential 7.2% return for a transaction that may take six months to a year to close, compared to a 4.5% return in cash.
Andy Constan, founder and strategist at Damped Spring Macro, highlights the distinction between fundamental market sentiment toward the deal and its likelihood of being completed.
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Constan previously highlighted the impact of unfavorable deals on equity performance, noting ONDS stock fell 55 percent to a year-to-date low after a shareholder-unfriendly agreement in a recent report. He has also observed that a net long range of 48-56% for long/short equity funds results in only a modest 1.2% return difference, as discussed in an earlier analysis. His commentary often separates fundamental deal sentiment from potential investor returns.