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I didn't go through all the math but I believe you're approaching the problem correctly. One of the reasons there is a spread is due to the fact that the deal may not go through. You can also capture the spread which might be worth doing if you thought the deal was going to go through. Short the acquirer and go long the aquiree in equal $ amounts. Of course if the deal falls through you might lose on both sides. We've discussed this topic many moons ago. Ray Zee basically stated that he's had decent success buying the acquiree (I have too after taking his advice) and Ray also pointed out that the market doesn't always have these deals analyzed all that well so the spread is often too high.