This is tom nash and warren buffett just took a huge bet against wall street and trust me. You want to hear about this because, beyond the popcorn value, there's a lot of money making opportunities right here, you don't want to miss out on. Let's do this hey thanks for staying and here's what i got in store for you on january 18. 2022.

Just a couple of months ago, microsoft announced the acquiring activision blizzard for 95 dollars per share, which is a massive 50 premium over then share price 64.. Now what actually happens here that, if you're a shareholder of activision blizzard all that means once the deal completes you're getting 95 per share into your brokerage? Account simple as that now, despite the ease of what i just explained, things are not that simple. Currently, at 75.5 dollars a massive twenty dollars below the deal price representing a nice 26 arbitrage between the share price and what the shares will be worth once the deal is completed now just for reference. If you're looking at twitter versus elon that deal isn't priced at a 26 arbitrage, in fact, that deal is priced at 49 with the payout being 54.20, as you all know, so that deal has about 10 risk.

This deal shows 26 risk. Essentially, with that amount of risk pricing wall street is essentially saying hey. We think it's more likely than not that this deal isn't happening. They're betting against this deal now what's shocking.

Here is of all people of anybody you can think of to be against wall street is the crazy grandpa from omaha, and let me show you how and since in my videos the bottom line always comes first, i'm not gon na drag you through the video just To share with you my conclusion, so my conclusion is quite simple: the crazy grandpa from omaha aka warren buffett aka, the dominator - is actually bidding heavy against wall street. Here he's going balls deep into this with a lot of money. Now, what initially started is a small 800 million bit, which was actually made by one of his lieutenants now has become a full-on warren buffett, personal bet of 5.5 billion - that this deal is actually happening at a much higher price than what was originally the original 800 Million dollar bet, and so my bottom line is very simple. I believe that warren buffett is correct here and i believe that the wall street analysts are mispricing this deal because of lack of understanding of the video game industry, as i will show you in this video i'll walk you through what warren buffett is doing, how he's Doing it and if you're interested how you can also tag along with him for these nice 26 percent.

Essentially this wasn't even warren. Buffett's deal to begin with. Initially one of his lieutenants at berkshire, hathaway made an 800 million dollars arbitrage deal, it's called the risk arbitrage. You essentially bet the deal will go through and will not fall apart now.

This was a small bet worth about two percent of the entire stock of activism, not a huge deal, but basically the play was quite simple: they bought it at sixty dollars per share. They being berkshire hathaway and if the deal actually goes through, they'll get 95 per share, meaning a nice 58 gain on an investment of 800 million dollars, not bad now, nothing to get excited about if you break your hath away, but a really nice play and what Happened on friday is actually quite astonishing because warren buffett came out and said hey from now on. This is my decision. This was made by one of my lieutenants, but now i'm personally deciding to quadruple in fact 5x.

This bet all the way to 5.5 billion dollars at a higher price at 70 bucks per share, and that basically means he's going all in because going above 10 isn't an option from a whole bunch of regulatory reasons. I'm not gon na get into this right now, but it just goes to show you he's all in now what he actually did here. He increased his cost basis from 60 to around 70. With this deal essentially cutting into the profits instead of 58 arbitrage right now, they're looking 40, not bad for a bet that i think is actually very, very logical now, if you jump in on this right now, you're gon na be buying at seventy five dollars per Share for a ninety five dollar per share deal, which means you're looking at twenty six percent arbitrage, not as good as warren, but quite nice, giving what i'm about to show you and if you're, considering jumping into this risk arbitrage deal yourself.

The only thing you need to be concerned about is not the macro, not the fundamentals of the companies. The only thing is: what are the chances of success of this deal? That's the only thing and look: there's been a few positive signs as of late on april 28th, just a few days ago, the shareholders of activision, in fact, 98 of them, approved the deal and, of course, like everything in life, nothing is simple and peachy. There are issues that you need to be considering, for example, unlike the twitter deal, which has a five month expiration period. This deal has over a year until june of next year, so you're gon na be looking at a long period until you actually see any money.

If any, that's something you have to be considering, however, that's just a timing issue the main risk in this deal - and everybody knows that is the competition analysis, the antichrist issues, the ftc. This deal has to be approved in 17 countries in order to go through. May i just remind you, the nvidia and arm deal which failed on anti-trust issues. That's not an easy hurdle to cross.

Now the main country to be concerned about is the united states, because in the united states the regulator that's in charge of these approvals is the ftc and the newly appointed head of ftc lina khan, not related to gingis. I'm assuming is actually very aggressive with her approach to tick mergers. By definition, she does not like that and she's very outspoken against companies expanding and limiting competition through m a mergers and acquisitions. She was the one who shut down the nvidia and arm deal.

She also shut down lockheed martin, an aerojet deal. She has been instrumental in going after facebook and amazon she's very competitive, she's very aggressive, and the market is pricing that in as if this deal is gon na, face massive ftc hurdles, which i'm not saying it won't. But i think people are overshooting the risk here, a little bit. Let me show you why.

So, first of all, let's be pragmatic. Here i mean lina khan is a 33 year old young, aspiring regulator, she's, definitely trying to make a career of herself and what better way than to go after microsoft, she's already going after facebook and after amazon. But that's exactly the problem. The ftc is a governmental regulator; it only can fight so many fronts.

At the same time, it has limited resources to go after facebook and amazon and microsoft. At the same time, it's not going to be easy and she has to pick her battles and going after facebook with their well-documented issues and the pr nightmare that they are. I mean it's not me saying that it's kind of a known deal it's much easier than to go after microsoft, which hadn't really had any issues with the ftc for the past two decades. Also, i mean it's a harder case.

If this deal goes through, microsoft is going to become one of the biggest gaming companies in the entire world, along with sony and tencent. And yes, this is the biggest acquisition in the history of microsoft. But having said all that this deal is still a very tough case for the ftc to pursue, because the ftc has to look at this deal in either of two ways either as a horizontal merger or a vertical merger. Now a horizontal merger is when one competitor is buying another, that's an easy case to be made as far as the elimination of competition.

However, in a highly competitive environment, which is the video game development industry, eliminating one competitor with this insane competition going on, it's going to be a very hard case to make for the ftc to step. In now, they can of course go for the vertical argument and say that microsoft provides consoles and platforms and now they're buying a vertical producer of games. Now, in that case, they'll have to show that this reduces competition, because they're going to deny access from other participants of the market to this video game company. Now, in this case, what it actually means is that activision makes a very famous game called call of duty.

A call of duty was a staple in the video game. Community trust me as a gamer. I can attest to that. It's very common both on microsoft consoles and on sony consoles, and the fear would be that microsoft would come in and say this is going to be an exclusive just for our consoles, we're not going to let sony access to this game now that has been already Eliminated - and that is something i expected the wall street analyst to know, because microsoft came out day one and said hey.

We have zero intentions to make call of duty and exclusive it's bad business. Nobody wants the best selling game in history, at least a shooter to be on one console. Instead of two, that's cutting your market in half for absolutely no reason - and you know the ftc might ask microsoft to sign a legal document stating that they're not going to do that and i'm sure microsoft will. But in essence this makes the whole case either.

As a vertical or as a horizontal merger, a problem for the ftc and, in fact, professor daniel crane, an expert in antitrust from the university of michigan, actually said the following. If i microsoft i'm expecting pushback from the ftc, however, i'm feeling pretty confident about my odds here. So basically, what he's saying here is the ftc have to politically show that they're going for microsoft, but the case is not that strong. Now i'm gon na try and have mr crane or professor crane on my show on the podcast.

I have just a no as soon as i can i already emailed him, and that means we're left with one question: what are your next steps well step? Number one. Could be to actually try to go for this deal along with warren buffett and berkshire hathaway, take your 26 percent and enjoy them now, for that you have to talk to a professional, because this isn't financial advice. It's just my opinion might be, an accurate might be wrong, might be the ramblings of a madman. If that's the case and you decide to go for this deal, i wish you the best of luck.

But if you don't, it's still going to be hilariously entertaining so grab some popcorn sit back, relax and enjoy the show, as always, a huge shout out to the channel members and the patrons for making this content possible. Thank you. So much from the bottom of my heart, if you want to join the link, is below it's five bucks per month. Appreciate you see you next video.