CGF was the indexes best performing stock yesterday soaring +8.8% as Athene bought a $720m stake in the business and appears to want more – importantly the Bermuda based life assurance business is currently merging with M&A powerhouse Apollo Global Management. At MM we managed to avoid the huge declines experienced by CGF over recent years but the risk /reward is now looking interesting for this “situation play”. As we touched on recently the combination of cheap debt, huge cash war-chests, an improving global economy and the likelihood of rising rates is fuelling an almost now or never attitude in M&A land.
MM likes CGF with stops under $5.50 i.e. less than 10% risk
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