Why Del Taco Rallied 66% Today, While Jack in the Box Fell a Little
Shares of Mexican fast-food chain Del Taco (NASDAQ: TACO) rallied out of the gate on Monday, gaining a massive 66% as of 2:20 p.m. ET. Meanwhile, shares of burger joint Jack in the Box (NASDAQ: JACK) fell by as much as 8% at one point in morning trading, though that loss was later pared to just a few percentage points. These price moves actually made a lot of sense given the announcement that Del Taco had agreed to be acquired by Jack in the Box.
It is totally normal for the share price of a company that's making an acquisition to fall a bit. So there's really not too much to say about Jack in the Box's price drop other than that it's understandable given that it just agreed to pay $12.51 per share in cash for Del Taco. Including debt, the total deal is valued at $575 million. Since Jack in the Box will have to come up with a big chunk of cash, investors are pulling back from its shares.
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Source Fool.com
