Another odd lot idea (CACC)

Credit Acceptance Corporation (CACC) has announced a tender offer to buy back 1,000,000 shares at a price of $84.45/share. The stock is currently trading at $80.12, and if you own less that 100 shares you will not get prorated if you tender. So this could be an easy opportunity to make a bit more than $400.

There are however always some conditions that make it possible for the company to cancel the tender offer (see for full details the SEC filing). If the stock is for example down more than 10% after May 31 the tender offer can be cancelled, and so far it’s down 5% already. So it’s certainly not risk free, but at the same time it’s also certain that as an odd lot holder you will have an edge.

Disclosure

Author is long CACC

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