Week one, disclose position in Longs Drug Stores (LDG). Next week, make 87% on investment when CVS (CVS) buys you out.
Reuters Reports:
“CVS Caremark will pay $71.50 per share for Longs to acquire some 521 Longs stores in California, Nevada, Arizona and Hawaii, as well as its Rx America subsidiary, a prescription benefits management services company.
The deal was expected to crimp earnings per share at CVS Caremark in its first year, but add to earnings beginning in 2010, the companies said.
CVS Caremark is expected to gain cost savings of approximately $100 million in 2009 and approximately $140 million to $150 million in 2010 from purchasing savings and lower selling, general and administrative costs.
“This transaction provides tremendous benefits to CVS Caremark by accelerating our expansion in very attractive drugstore markets and strengthening our geographic reach,” the company’s chairman and chief executive, Thomas Ryan, said in a statement.”
Ackman has an economic interest in 23% of the company. Quick math says he nets $667 million and a rough estimate profit of $580 million. Not a bad week at all…
Disclosure (“none” means no position):None
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