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PPR agreed to purchase of LVMHs holdings of Gucci for $94 a share. Gucci will pay an extraordinary dividend of $7 per share to non-LVMH
- PPR agreed to purchase of LVMHs holdings of Gucci for $94 a share.
- Gucci will pay an extraordinary dividend of $7 per share to non-LVMH shareholders in 3 months' time.
- PPR is offering non-LVMH shareholders a put option with a strike price of $101.50 and a maturity date of March, 2004.
- The US ADR closed at $87.53 after this news was released.
This put option was valued at $21 by one analyst. Assuming that:
T= 2.5 years and r(risk-free) = 5%
What was the implied volatility of Gucci shares?
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Real Estate Finance Today
Authors: Dearborn
6th Edition
1475407475, 9781475407471
