Ever since the announcement of the upcoming merger between Frasers Commercial Trust (“FCOT”) and Frasers Logistics & Industrial Trust (“FLT”), it gave rise to the strange situation of an arbitrage forming due to wide pricing fluctuation between the 2 REITs. Arbitrage is the process of exploiting differences in the price of an asset by simultaneously buying and selling it and in the process, the arbitrageur pockets an almost risk free return. For example,  On 3rd December 2019, the price of FCOT suddenly shot up to S$1.72 when the offered price for the merger exercise valued it at S$1.68.
Extract of Merger Scheme for FCOT and FLIT1. Market apparently is trying to price in who received the shorter end of the stick
Now, this is a matter of differences in perspectives that lead to the see-saw pricing of both FCOT and FLT ever since the merger announcement. Some view that FCOT got the