MTTR - Matterport: Deal Premium Creeping Up Still Not Enticed

2024-06-14 17:39:33 ET

Summary

• Matterport, Inc. fell off investors' radars after the buyout agreement with CoStar Group, but the recent stock slump offers a large deal premium.
• The CoStar deal values Matterport at $2.1 billion, with $2.75 cash and $2.63 shares, providing a current 35% premium to shareholders.
• Matterport has up to 50% downside risk on small likelihood of the merger not closing.

Matterport, Inc. ( MTTR ) recently fell off investors radars following a buyout agreement with CoStar Group ( CSGP ). Oddly, though, the stock has slumped to where the deal now offers a large premium and appears to signal the risks of the deal closing is somehow rising. My investment thesis is still Neutral on the stock, but the recent dip highlights the importance of dumping stocks before losing deal premium during the closing process....

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