Tag Archives: Synchrony Financial

GE/SYF Exchange transaction update – $200 return

Quick update: Exchange ratio risk has been almost eliminated and this starts to look like a standard Odd Lot tender offer (besides having to short SYF) with guaranteed $200 return. The main risk remaining is that transaction will be cancelled due to low participation (I consider this unlikely). As per filling “The minimum condition provides that GE is not required to complete the exchange offer unless at least 634,743,750 shares of Synchrony common stock will be distributed in exchange for shares

General Electric (GE) – Split-off transaction – $216 expected return (potential for $600 return)

Current Price – GE $29.03, SYF $31.32;

Offer Price – $1.0753 stock of SYF for $1 stock of GE (subject to upper limit of 1.1308 SYF shares per share of GE);

Upside – 7.5% or $216 for Odd Lot holders (if price differential increases towards upper limit – as happened with other recent split-off transactions – the return will be c. $600);

Expiration date – November 16, 2015;