Why Don't LEH Suitors Just Buy Shares in the Open Market?

A

aeliodon

If a suitor wants to bid $10 for LEH then why not just buy 25% of the company in the open market at below $5?

There is a ton of liquidity for anyone that wants to buy millions of shares.

Same thing with WM - these are penny stocks now in which 50% of the float trades every single day.
 
Quote from aeliodon:

If a suitor wants to bid $10 for LEH then why not just buy 25% of the company in the open market at below $5?

There is a ton of liquidity for anyone that wants to buy millions of shares.

Same thing with WM - these are penny stocks now in which 50% of the float trades every single day.
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LEH is not worth $10 !!!

and WM is worth -0-

LEH has a bit of value and for the right price ..will be sold or split into pieces ... WM has 120b+ in toxic mbs with something like a 40B reserve .. they are practically insolvent ..

http://ml-implode.com/viewnews/2008-09-11_BanksWhereTheMoneysNot.html

interesting article on our "banking system"
 
I think any bid for LEH would have to be greater than $10 to have a bullish market impact - since that's how much BSC got sold for. I think BSC got sold for about 2-3 billion. And LEH at 10 would be a 6-7 billion sale price.

Jamie Dimon has already stated that JPM got a great deal on BSC even at $10 - so I doubt LEH would sell for less since they are in much better shape than BSC. LEH has access to the discount window and has had a lot of time to leverage.

Being long LEH right now is like being long a really cheap OTM call option with a great R:R ratio.
 
I don't think a 13d filing should hold any suitor back from buying shares at market. There is no way LEH will sell for less than 6 so why not buy all the shares you can below that.
 
It's looking like something is going to happen over the weekend with LEH.
Is anyone going long at the close to play this? Opinions?
 
I am long LEH shares and options. My position is small as is my risk. There is no way in hell that the bid for LEH is below the current price of 3.62 and there is no way LEH is going to 0.
 
Quote from aeliodon:

I am long LEH shares and options. My position is small as is my risk. There is no way in hell that the bid for LEH is below the current price of 3.62 and there is no way LEH is going to 0.
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so the market has got this all wrong with LEH ??

listen to the market ..its telling you something ....
 
I'll give it a miss, just feels too much like a flip of the coin trade, these really are uncharted grounds, though I'll probably kick myself come Monday.

Good luck to you Aeliodon.
 
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