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If you are paid with stock of acquiring company you buy put options on that stock as insurance that you won't get wiped out if the acquirer crumbles.
by ahi 14y ago
If you are paid with stock of acquiring company you buy put options on that stock as insurance that you won't get wiped out if the acquirer crumbles.
- jessaustin 14y agoYeah that's what I meant; although I think typically acquirers offer bonuses in (call) options rather straight stock for those current employees of the acquired company whom they wish to retain. If you buy the corresponding put options and the acquirer tanks you won't have to wait for vesting to make money either. If the acquirer does well then maybe working for that company isn't so bad. It's very possible that the costs or terms of available options would make this unfeasible. It's just something one thinks about when all his options are underwater.