Purchase: Jaclyn (JLN)

I purchased Jaclyn (JLN) as an arbitrage play. I evaluated the company in a post recently. The stock has been selling off over the last few days and I hope it isn't due to some bad news on the horizon. Some investors may be selling now that the stock is going to be demoted from AMEX to PinkSheets OTC but it's not clear. Since there are no arbitrage funds involved in this (only ownes with less than 250 shares get a cash offer) the price likely provides no signal regarding the buyout of minority owners.

Purchase Price: $7.80
Time Horizon: Short-term (special situation)

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3 Response to Purchase: Jaclyn (JLN)

May 6, 2008 at 10:22 PM

Well thought-out analysis of JLN. I purchased my shares a month ago for $7.60. I have done a lot of arbitrage plays over the last 2 years and have done pretty well. I have a blog mostly dedicated to arbitrage investing at www.ryanhegs.com. Hopefully you will find it interesting and useful. I plan to continue visiting your blog to get your insight on situations.

May 6, 2008 at 11:02 PM

I stumbled across the original post on circle of competence a day before I saw your post. Great to see others backing up the analysis. Good luck!

May 7, 2008 at 11:29 AM

Thanks for the comments...

To Ryan (or others who have done a lot of M&A arbirage):

One of the things I've been reading, and I commented on this a while before , is the risk that arbitrage works until it doesn't. That is, over the last few years, most deals have closed successfully and it was hard not to lose money. But are we in a new phase when more diligence is required on our part? Just something crossing my mind these days...

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