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Sold American Greetings (AM)

July 3, 2013

Yesterday I sold my position in American Greetings. The Weiss family (controlling shareholders and current management) came out with an increased offer for their planned going private transaction of $19/share (up from $18.20). I really don’t like the amount of the new offer or the message that it sends; I think the family continues to lowball investors. This was the moment for them to really up the ante and close the deal by offering $21 or $22/share. They didn’t do it, and I think that this transaction will drag on a while longer as I doubt current arbitrage holders will be satisfied with the new offer. I sold my position as my original intent was to ‘park’ some extra funds for a few months with the expectation of making 10%-20%. I now think the time line for this transaction is longer than that, and there is the distinct possibility that the Weiss family will be so tight-fisted as to perhaps endanger the transaction itself. So I sold at $19 for a paltry 4% return (including the $.15 dividend payable shortly), but considering I held this position only 5 1/2 weeks, this translates into a 35% annualized return.

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From → Positions Closed

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