By: Dividend Sensei
Recently Morgan Stanley noted that a potential $300 billion mega-merger, the largest in corporate history, made financial sense.
Since the abandoned $200 billion merger attempt in 2019, analysts have continued to believe such a deal made sense, and the current CEO of one of these companies has left the door open for one.
The benefits to investors in both companies are extremely enticing, making the probability of this merger eventually happening relatively high.
The benefits to investors in this dividend king being acquired include a 7.1% to 8.7% yield on today’s price, a 50% to 85% premium buyout price, and a significantly faster-growing company with an even safer dividend.
The benefits to the acquiring dividend king would be an immediate boost to EPS, of up to 10%, likely resulting in a 10% dividend boost, on top of its very safe nearly 5% yield.
I’ve personally invested $28,000 in my retirement portfolio into both dividend kings, though a potential $300 billion mega-merger would be just the cherry on top in terms of long-term payoff.