RDBX - Why is Redbox crashing and Chicken Soup surging? The merger is here

The wonky merger math around trading in Redbox Entertainment ( NASDAQ: RDBX ) and its acquirer Chicken Soup for the Soul Entertainment ( NASDAQ: CSSE ) is straightening out, with the deal set to be consummated tonight.

With a definitive acquisition deal implying it should have been trading around $1 per share, Redbox ( RDBX ) has been far outstripping that value in volatile trading over the past several weeks , in what looks like retail-investor speculation.

That's come crashing down Wednesday with Redbox's approval of the takeover . (Controlling stockholders had already agreed to the deal, making Wednesday's approval more of a formality.)

Late Wednesday, Redbox stock ( RDBX ) is down 52% to $1.68. Chicken Soup for the Soul Entertainment ( CSSE ), meanwhile, is up 36.3% to $15.47.

Pursuant to the all-stock deal, Redbox stockholders will receive a fixed exchange ratio of 0.087 of a share of CSSE class A common stock per Redbox share.

At Wednesday afternoon's higher price for CSSE, it implies a Redbox share price of $1.21 - now at least within spitting distance of Redbox's quote of $1.68.

Seeking Alpha contributor Chris DeMuth Jr. has a (tongue-in-cheek?) long recommendation for Redbox this hour, banking on an odd-lots approach to the deal: Buy one share of Redbox now, he says, counting on a potential broker round-up of the resulting fractional share to a full share of Chicken Soup tomorrow .

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