As part of the deal to merge Discovery with AT&T's WarnerMedia unit, all classes of Discovery stock will be consolidated in a single class of stock. This seems like a risky but interesting arbitrage play given the prices of Discovery shares and the high likelihood the merger will go through.
Discovery currently has three classes of shares:
Discovery Class A (DISCA) trading at $33.11
Discovery Class B (DISCB) trading at $77.98
Discovery Class C (DISCK) trading at $31.04
DISCA is voting stock, DISCB is supervoting stock and DISCK is nonvoting stock. DISCB has too small a float to short safely but going long DISCK and short DISCA seems a reasonable arb. Thoughts ?
Submitted May 19, 2021 at 06:33PM by puzzlesrus https://ift.tt/3whSggm
