Will this deal go wrong, or will INTU Properties shares rise even further?

• The chart shows the INTU Properties share price movements since January.
• 4 Oct: Brookfield Consortium (Brookfield, Peel, Olayan) confirm mulling cash offer for Intu Properties.
• Shares jumped 37% to trade their highest since June
• 11 Oct: INTU receives 205p/share offer from the consortium
• 19 Oct: Offer improved to 215p, or 210.4p adjusted for 4.6p interim dividend
• 31 Oct: UK takeover panel extends takeover offer deadline from 1 Nov to 15 Nov
• 14 Nov: Offer deadline extended by another week to 22 Nov.
• 22 Nov: Offer deadline extended (3rd time) to 30 Nov to continue talks and for consortium to complete financing process & satisfy other preconditions.
• Shares now 194.7p (at time of writing)
• Will the deal be abandoned, will the deal fall through or will another even higher offer emerge to acquire the company?
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading INTU Properties – An Example

Let’s say you think that INTU Properties is likely to rise further as a result of a takeover offer, towards the 255p  highs around the turn of the year. You decide to buy exposure to £10,000 worth of INTU Properties using a CFD, at the current price of 194.7p. To do this, you need £2,000.

For the purpose of this example, let’s assume the INTU Properties share price rises by 10%. Your profit would be £1000, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. Sentiment towards the deal sours and INTU Properties shares fall 5% and hit your stop-loss. Your loss would be £500.

This is provided for information purposes only. It should not be taken as a recommendation.