Terra Industries Inc. (NYSE: TRA) is seeing a lot of options action today with 17,164 calls trading as of 2:00 PM EST, and 45% offer side buying with shares at $35.65. Interestingly enough, a trader bought 5,000 November $40 calls at 35 cents on a 25-40 spread, a bullish bias. Another large buyer of December $39 calls came in around 1:20pm for 5,000 calls at the offer. Implied volatility is gaining 7% today to 60% as holders are urged to reject CF Industries’ (NYSE: CF) latest takeover offer. The current offer would give a value around $40 for Terra shares. This is occurring as CF is busy rejecting Agrium’s (NYSE: AGU) raised takeover offer. It appears the with this trading today we may get some clarity soon on the M&A saga, a possibly a bid Terra can not resist.
-Joe Kunkle, OptionsHawk.com
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