Options Trading Tutorial

What happens to call options when a company is bought for cash at less than the strike price?

e.g. have a call for $100, competitor announces it is buying all the stock for $95. e.g. I have longterm (LEAP) call for $100. A competitor announces it is buying all the stock for $95. Is the call now worthless or will the call be transfered to the new company?

Public Comments

1. your call option is worth less at the moment since you can buy the company for 95 instead of 100.
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