Phillips was to pay Tosco investors 0.8 Phillips shares for every Tosco share they tendered.

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Example: Gasoline refiner Tosco agreed in February to be acquired by Phillips Petroleum.

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Seven months later, when the arrangement passed regulatory muster and closed, the fund covered its short sale with the Phillips shares it received on exchanging the Tosco stake.

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That return, unannualized, takes into account the pricing spread, the dividends received on Tosco and the payments in lieu of dividends the fund owed on Phillips to the lender of the Phillips shares.

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